Principal Issues: Is a Director of Creative Arts entitled to the clergy residence deduction under 8(1)(c)?
Position: No
Reasons: Does not meet status tests
2007-022842 XXXXXXXXXX C. Tremblay, CMA (613) 957-2139 April 20, 2007
Dear XXXXXXXXXX:
Re: Clergy Residence Deduction
This is in reply to your electronic message of March 22, 2007, wherein you included your job description and an update of your employment file at XXXXXXXXXX. You disagree with the March 1, 2007 response we sent to XXXXXXXXXX stating that the Director of Creative Arts would not qualify for the clergy residence deduction.
Our Comments:
The particular circumstance in your letter on which you have asked for our views is a factual situation. As explained in Information Circular 70-6R5, it is not this Directorate's practice to comment on transactions involving specific taxpayers other than in the form of an advance income tax ruling. However, we have considered your enquiry and provide the following comments, which are of a general nature only.
As stated in paragraph 3 and 4 of Interpretation Bulletin IT-141R (Consolidated), whether or not a person meets the status test and is a "member of the clergy" or a "regular minister" depends upon the structure and practices of the particular church or religious denomination. In most established Christian churches, a regular minister would also be an ordained minister. However, whether ordained or not, the individual should be authorized to perform all of the duties or at least most of the duties of a regular minister. Accordingly, the individual must be authorized or empowered to perform spiritual duties, conduct religious services, administer sacraments and carry out similar functions. Religious functions may include participation in the conduct of religious services, the administration of some of the rituals, ordinances or sacraments, and pastoral responsibilities to specific segments of the religious organization. The position should also be one of some permanence.
Accordingly, from the review of your job description and the terms of your employment, in our view, you would not meet the status test and would not be entitled to a deduction under paragraph 8(1)(c) of the Act. We have not considered the function test further to our March 1, 2007 response, as, in our view, the status test has not been met.
We trust these comments will be of assistance.
Yours truly,
Roberta Albert
For Director,
Financial Sector and Exempt Entities Division
Income Tax Rulings Directorate
Legislative Policy and Regulatory Affairs Branch