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15 February 1991 Ministerial Correspondence 910114 F- Personal Services Business Unedited CRA Tags 125(7) personal services business Dear Sirs: Re:  Personal Services Business This is in response to your letter dated January 2, 1991 requesting the Department's interpretation regarding the tax treatment of corporations considered to be personal services businesses. Whether or not a particular corporation is a personal services business is a question of fact to be determined from an examination of all the facts, however, under paragraph 125(7)(d) of the Act, a corporation is considered to be carrying on a personal services business if among other factors an individual performs services on behalf of the corporation (the "incorporated employee") and the incorporated employee or a person related thereto owns 10% or more of the shares of the corporation and the incorporated employee would otherwise, but for the existence of the corporation, reasonably be regarded as an employee or officer of the person who received the services from the corporation, unless the corporation employed, throughout the year, more than five full time employees in the business or the services were performed for a corporation with which it was associated. Thus where the corporation meets either one of the two exceptions stated above; it will not be considered to be carrying on a personal services business.  ...

The Taxpayer is considered a disabled person for CPP disability benefits and EI medical benefits. ... An impairment, as defined in the Act, is considered to be prolonged if it has lasted, or is expected to last (from the time the disability begins), for a continuous period of at least 12 months. ... By contrast, activities such as working, housekeeping or a social or recreational activity are not considered to be basic activities of daily living for purposes of determining eligibility for the disability tax credit. ...

Reasons: A taxpayer's TFSA trust is considered an affiliated person with the taxpayer. ... Under the Income Tax Act, a taxpayer's TFSA trust is considered a person affiliated with the taxpayer. ... " Accordingly, a capital loss realized from securities sold by a taxpayer and then immediately repurchased by the taxpayer's TFSA trust would be considered a superficial loss, and the amount of the capital loss would be nil. ...

Reasons: To be considered ongoing, the Regulations specify a minimum duration of eight weeks. ... " The Income Tax Regulations define what is considered a "prescribed program of physical activity" for the purposes of the credit. ... To be considered ongoing, the Regulations specify a minimum duration of eight weeks, with a minimum of one session per week, substantially all of which includes a significant amount of physical activity. ...

Reporting of news, preparation of copy of advertisements, photographs and art work, and editing are also considered qualified activities provided that the physical activities of manufacturing a newspaper are carried out by the taxpayer. ... However, the outcome and rationale for the decisions made in these cases is considered by the Department to have restricted application to similar businesses in the oil well service industry. ... The basis for the position in paragraph 44 of IT-145R allowing most of the activities performed in connection with publication of a newspaper to be considered qualifying activities arose as a result of the Department losing the   court case The St. ...

Would partnership A be considered to have acquired a specified animal from a person with whom it was not dealing at arm's length? ... Would partnership C be considered to have acquired a specified animal from a person with whom it was not dealing at arm's length? ... Would partnership G be considered to have acquired a specified animal from a person with whom it was not dealing at arms length. ...

In Interpretation Bulletin IT-339R2, Meaning of private health services plan [1988 and subsequent taxation years], the CRA lists the requirements a plan has to meet for it to be considered a PHSP. ... As over-the-counter drugs, including natural health products, generally would not qualify for the tax credit, a plan that covers such drugs would not be considered a PHSP. ... Any proposed changes to tax policy or legislation would have to be considered by Finance Canada and approved by Parliament. ...

Whether a postdoctoral fellowship is considered employment income. Position: 1. ... Amounts received by post-doctoral fellows will likely be considered employment income, research grants, scholarship income, or some combination of these. In the past, the CRA has generally considered the income received by post-doctoral fellows to be either employment income or research grants. ...

Reasons: The transactions are considered to be a disposition and acquisition between separate taxpayers occurring at fair market value. ... For income tax purposes, your RRSP and TFSA trusts are considered to be separate and distinct entities from each other and from you. ... The contribution to the TFSA will be considered a disposition of the securities by you and an acquisition of the securities by the TFSA. ...

You asked whether such partnership property would be a "former business property" as defined in subsection 248(1) of the Act and, more particularly, you are concerned whether that property may be considered to have been used by "a person related to the taxpayer" as required by that definition. ... However, subsection 251(2) of the Act does not provide that partnerships may be considered to be "related persons" or "persons related to each other". Also, since in the particular scenario described above, the other partnership would not be involved in the computation of income, that partnership, therefore, would not be considered to be a person. ...