Principal Issues: [TaxInterpretations translation]
Whether a civil partnership constituted under French law constitutes a partnership or a corporation for the purposes of the Income Tax Act.
Position: A French civil partnership should be considered a partnership for the purposes of the Income Tax Act.
Reasons: The attributes of a civil partnership created under French law are more similar to those of a partnership than to those of a corporation.
February 5, 2001
Montérégie Rive-Sud TSO Income Tax Rulings Directorate
Audit Review International Operations and Trusts Division
Attention: Jacques Blanchard Éric Allard-Pouliot
(613) 957-20972000-006292
Definition of a Civil Partnership
This is in response to your memo of December 27, 2000 regarding the above subject. More specifically, you requested our opinion on the status, for Canadian tax purposes, of a civil partnership created under French law, namely whether such a partnership should be considered, for purposes of the Income Tax Act (the “Act”), as a partnership or as a corporation.
Generally speaking, the attributes of an entity created under foreign law must be examined and compared to those of a Canadian partnership and a Canadian corporation in order to determine the status of such entity for the purposes of the Act.
After analyzing the articles of association of the XXXXXXXXXX civil partnership, a copy of which was attached to your memo, and the provisions of the French Civil Code applicable to civil partnerships, we are of the view that the attributes of the civil partnership XXXXXXXXXX created under French law are more similar to those of a partnership created under common law and that, consequently, this entity should be considered a partnership for the purposes of the Act. The fact that such an entity has legal personality under French law does not in itself prevent it from being considered a partnership for the purposes of the Act. Consequently, insofar as there are no facts indicating that the articles of association of the XXXXXXXXXX civil partnership do not reflect the true intention of the parties, this entity should be considered a partnership for the purposes of the Act.
For your information, a copy of this memorandum will be severed using the Access to Information Act and will be available in the Legislative Access Database (LAD) located on the mainframe of the Canada Customs and Revenue Agency. A severed copy will also be distributed to the commercial tax publishers for inclusion in their databases. The severing process will remove all material that is not subject to disclosure, including information that could disclose the identity of the taxpayer. Should your client request a copy of this memorandum, the Legislative Access Bank version can be provided. Alternatively, the client may request a severed copy using the Privacy Act criteria, which does not remove client identity. Requests for this latter version should be made by you to Ms. Jackie Page at (819) 994-2898. A copy will be sent to you for delivery to the client.
Alain Godin
for the Director
International Operations and Trusts Division
Income Tax Rulings Directorate
Policy and Legislation Branch
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