18 December 2001 Ministerial Correspondence 2001-0111924 - Foreign Spin-Offs-Latefiled Election

By services, 18 December, 2018
Bundle date
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Foreign Spin-Offs-Latefiled Election
Language
English
CRA tags
86.1
Document number
Citation name
2001-0111924
Severed letter type
Ministerial Correspondence
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Main text

Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CCRA.

Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ADRC.

Principal Issues: Whether we can extend the September 11, 2001 deadline for shareholder elections filed under new s.86.1.

Position: No. However, the timing problems are being reviewed by Wayne Adams with Finance and A&C Branch is also looking into this.

Reasons: There is no provision for extending the filing deadline in this case.

XXXXXXXXXX

Dear XXXXXXXXXX:

I am writing in reply to your letter of November 8, 2001, concerning the granting of extensions of time to file the foreign spin-off election found in section 86.1 of the Income Tax Act (the "Act").

In your letter, you comment on the difficulties encountered by trustees and sponsors of mutual fund and pooled fund trusts, with respect to the timing of the foreign spin-off election. In particular, you describe the problems of these taxpayers in trying to meet the September 11, 2001 election deadline for foreign spin-offs that took place in 1998, 1999 and 2000. You also note that you identified the time limit for filing a foreign spin-off election as a problem in a letter to the Department of Finance dated January 10, 2001. This letter was copied to the attention of Mr. Bernhard Buetow of the Canada Customs and Revenue Agency (CCRA).

The issues that you have raised involving the timing of the foreign spin-off election, including the matter of the September 11, 2001 election deadline and the more general problems being encountered by corporate trustees, are currently under consideration by the CCRA. We continue to be of the view that, as a matter of law, we cannot accept late-filed foreign spin-off elections, however, we are in contact with officials of the Department of Finance with a view to resolving this and related issues. I would be pleased to advise you of the outcome of our discussions.

I trust the comments provided are helpful.

							Yours sincerely,
							Bill McCloskey
							Assistant Commissioner
							Policy and Legislation Branch

Eliza Erskine
952-1361
November 30, 2001