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M.N.R. (92 DTC 1622), has considered this type of situation in which the governing document (decree, order or judgement of a competent tribunal or a written agreement) provides that the payer must pay the tax payable on the allowance in addition to the allowance itself, and determined that the tax payable will be considered part of the allowance and will be deductible as well. ...

Nevertheless, should part of the retiring allowance relate to services rendered outside Canada for which the Canadian employer is not reimbursed by the non-resident employers it does not appear that the payment of the retiring allowance could be considered as having been made or incurred for the purpose of gaining or producing income from a business or property in the Canadian company. Furthermore, it would appear that the payment by the Canadian company of the part of the retiring allowance which related to the services rendered outside Canada could be considered to be a benefit conferred on another member or members of the corporate group to which the Canadian company belongs. ...

Securities and the Canadian Securities currently have accrued unrealized net capital gains. 12.To the best of your knowledge and that of the taxpayers involved: a) none of the issues involved in this advance income tax ruling is being considered by a Tax Services Office or a Taxation Centre in connection with a tax return already filed, and b) none of the issues involved in this advance income tax ruling is the subject of any notice of objection or is under appeal. ... Securities will be considered payable to the Beneficiary and deductible from the Estate's income pursuant to paragraph 104(6)(b). ...

You have advised us that to the best of your knowledge and that of XXXXXXXXXX none of the issues involved herein are being considered by a Tax Services Office or Taxation Centre of Revenue Canada in connection with a tax return already filed and that none of the issues are under objection or appeal. ... C.The full amount of the Retiring Allowance will be deductible in determining the income of XXXXXXXXXX for the taxation year for which it is paid and will be considered reasonable for the purpose of section 67 of the Act. ...

Reasons FOR POSITION TAKEN: The terms of the settlement are considered to be consistent with the Department's position set out in paragraphs 3 and 5 of IT-365R2. ... However, an irrevocable direction will be executed in respect of the annuity contract directing Lifeco A to make the payments directly to the Claimant or XXXXXXXXXX estate, as the case may be. 9.You have advised and you confirm to the best of your knowledge that none of the issues involved in this ruling request is being considered by a Tax Services office or a Tax Centre in connection with a tax return already filed and none of the issues is under objection. ...

We confirm that the above noted Ruling Letter is hereby cancelled in its entirety and replaced with the following: You have advised that to the best of your knowledge and that of all the taxpayers involved, none of the issues raised in this letter are being considered by any Tax Services Office and/or Taxation Centre in connection with any tax return already filed, nor are any of these issues under objection or appeal. ... However, the Class XXXXXXXXXX Shares of XXXXXXXXXX acquired by XXXXXXXXXX are not considered to be acquired in the ordinary of XXXXXXXXXX business, consequently, any dividends that XXXXXXXXXX receives on the Class XXXXXXXXXX Shares of XXXXXXXXXX that are otherwise be deductible in computing the taxable income of XXXXXXXXXX for the year in which dividends are received, pursuant to subsection 112(1) of the Act, will not be denied by subsection 112(2.1) of the Act. ...

Reasons FOR POSITION TAKEN: The terms of the settlement are considered to be consistent with the Department's position set out in paragraphs 3 and 5 of IT-365R2. ... However, an irrevocable direction will be executed in respect of the annuity contract directing Lifeco to make the payments directly to the Claimant or XXXXXXXXXX estate, as the case may be. 9.You have advised and you confirm to the best of your knowledge that none of the issues involved in this ruling request is being considered by a Tax Services office or a Tax Centre in connection with a tax return already filed and none of the issues is under objection. ...

When a loan is made to a shareholder in the ordinary course of the creditor's business with the same terms and conditions as offered to the public at large, the terms of repayment will normally be considered reasonable for the purpose of proposed subsection 15(2.3) of the Act. In particular, the minimum payments required under the terms of most commercial revolving credit sources will be considered to meet the requirement that bona fide arrangements be made for repayment of the debt or loan with a reasonable time for the purposes of proposed subsection 15(2.3) of the Act. ...

Principal Issues: renegotiation of employment contract to reduce salary in exchange for increased (non-taxable) benefits both in and outside of a flexible benefit plan Position: diversion of existing salary entitlements to pay for benefits is taxable but, provided that a valid renegotiated contract has been substituted for the former contract, additional benefits provided outside a flex plan will not be taxed as salary- if an employee's salary entitlement under a contract that has not expired is diverted to create credits under a flex plan, the plan will be considered to be funded by means of employee contributions Reasons: once a contract of employment has expired (as is common in a collective agreement which is renegotiated at regular intervals), the employee's right to maintain the level of salary is open to negotiation; with the result that a salary rollback combined with increased benefits does not involve a forfeiture of an existing entitlement. ... In such circumstances, the amounts withheld from income by the employer and used to cover the premium obligations will not be considered as employer contributions, but rather after-tax employee contributions. ...

The amount of a reimbursement, among other things, received by a taxpayer in respect of the cost of property or in respect of other expenditure, if included in income under paragraph 12(1)(x) of the Act may be considered a non-government assistance payment. ... Where, under a contractual arrangement, NRCo does not carry on any business in Canada and reimburses CANCo in respect of SR & ED expenditures incurred by CANCo in Canada and CANCo includes the amount of the reimbursement in computing its income from a business carried on in Canada pursuant to subsection 9(1) of the Act, it is our position that the reimbursement would not be considered to be a non-government assistance or a contract payment for the purposes of paragraph 127(11.1)(c) of the Act. ...