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Principal Issues: Whether a banked vacation plan can be considered a pension benefit, rather than vacation leave, and taxed under subsection 78(4). ... There are maximums concerning the amount an employee may bank, which are as follows: Vacation Entitlement Maximum Banking Entitlement 4 weeks 1 week 5 weeks 2 weeks 6 weeks 3 weeks In a letter to you dated August 5, 1999, concerning this issue, we indicated that the taxpayer's vacation plan would likely be considered "reasonable vacation or holiday pay" so that subsection 78(4) would not apply. We stated, however, that the banked vacation plan might be considered a "salary deferral arrangement. ...

The Association does not issue information slips with respect to amounts paid to the caregivers as the payments are considered to be non-taxable. ... The main concern is whether a handicapped child could be considered to be someone who "resides in the taxpayer's residence" (i.e., the residence of the caregiver) for the purposes of subparagraph 81(1)(h)(ii) of the Income Tax Act (the "Act") where the caregiver provides respite care to the handicapped child for a period of time, as noted above, and the child sleeps at the caregiver's residence during that time period. ... On the other hand, where the activity or undertaking has no reasonable expectation of producing a profit, a business would not be considered to have been carried on and any losses that resulted would not be deductible for income tax purposes. ...

Similar situations to be considered on a case by case basis. IT-337R3 par. 3(b) is to be revised to reflect this new position and this is to be announced in Income Tax Technical News. ... In order for an amount to be considered a "retiring allowance" it must be received "after retirement... from an office or employment in recognition of... long service" or "in respect of a loss of an office or employment". ... Consequently, in accordance with our published position in paragraph 3 of IT-337R3, the severance allowance would be considered employment income taxable in accordance with subsection 5(1) of the Act and no deduction would be available under paragraph 60(j.1) of the Act. ...

Persons who remain is the country for more than 182 days (whether consecutive or cumulative) in a fiscal year are considered residents of the Dominican Republic for tax purposes. ... In order to be considered "liable to taxation" for the purposes of the Fiscal Domicile article of the Convention and to qualify as a resident of the Dominican Republic thereunder, we are of the view that a person has to be taxed in the Dominican Republic on the most comprehensive basis of taxation in that country. ... The taxpayer's circumstances are distinguishable from our position on taxpayers who are considered resident under other income tax conventions notwithstanding that they are only liable to tax in the particular foreign country on a remittance basis. ...

If the annuitant pays such expenses then the costs will be considered premiums paid by the annuitant. 2) The interest will not be deductible because there will not be any income earned from a business or property. ... We also note that the CCRA has taken the general position that any amounts paid by an annuitant of an RRSP on behalf of the RRSP will be considered premiums as defined in subsection 146(1) of the Income Tax Act. In summary, RRSP mortgage set-up costs are not deductible by the RRSP annuitant and mortgage set-up costs paid by an annuitant on behalf of an RRSP will be considered premiums paid by the annuitant. ...

Principal Issues: Whether an executive MBA may be considered to be primarily for the employer's benefit and therefore non-taxable where it meets the guidelines for non-taxability except for the fact that the employee's salary is reduced by XXXXXXXXXX %. ... You feel that, because of the XXXXXXXXXX% reduction in the employee's pay, the employee's participation in the MBA Executive program may be considered to be primarily for the employee's benefit as contemplated in the third last paragraph of "Income Tax Technical News No. 13," ("ITTN No.13"). ... Since you stated in your letter that the executive MBA Executive program upgrades employer-related skills and the employee intends to return to work with his present employer after completing the program, it would appear that the payment by the employer of a portion of the employee's tuition may be considered to be primarily for the employer's benefit and therefore non-taxable, other than for the fact that the employee's salary is also reduced. ...

In this regard, it can be said that an employee may perform certain functions at different locations of the employer and at locations of customers or clients but an employee would be considered to be employed at the employer's place of business where work is normally reported for, direction is received, pay cheques are picked up, etc. An individual would be considered to be employed at one particular place of business rather than being employed at every different location that each performs a function of their employer. ... Although your facts indicate that the company did not report the taxable benefit arising from the catered meals on any T-4s, the possible application of paragraph 67.1(2)(d) of the Act should nevertheless be considered. ...

Reasons: As stated in paragraph 2 of IT-189R2, if the provincial law or regulatory body for a particular profession precludes the practice of the profession by a corporation, income derived from the profession will normally be considered to be earned by the individual who rendered such professional services and not by a corporation. ... In this regard, you indicated that, since the licensing of mutual fund salespersons in Ontario is currently restricted to individuals, until such time as the OSC allows the sale of mutual funds to be made by a registered/licensed corporation, the selling of mutual funds must be considered the Taxpayer's business. ... As stated in paragraph 2 of IT-189R2, if the provincial law or regulatory body for a particular profession precludes the practice of the profession by a corporation, income derived from the profession will normally be considered to be earned by the individual who rendered such professional services and not by a corporation. ...

Although these latter amounts are normally considered taxable employee benefits, a remission order was granted to eliminate any federal income tax consequences on such amounts paid in 1988 by an employer to an employee. ... These amounts are considered income for income tax purposes. However, to the extent that the amount of the assistance is offset by related costs, there are no tax consequences. ... Generally, the amount of assistance received in these situations is considered “proceeds of disposition” for purposes of calculating the “undepreciated capital cost” (defined in subsection 13(21) of the Act) or “recaptured depreciation” (subsection 13(1) of the Act). ...

We should also point out that Technical News No. 13, issued on May 7, 1998, provides new guidelines to determine when employer provided training is considered a taxable benefit. The newsletter states that “Courses which are taken for maintenance or upgrading of employer-related skills, when it is reasonable to assume that the employee will resume his or her employment for a reasonable period of time after completion of the courses, will generally be considered to primarily benefit the employer and therefore be non-taxable. ... In our view, since these employees are being trained for specific jobs in the employer’s organization, the benefits resulting from this arrangement would not be considered taxable. ...