| June 11, 1990 | |
| OTTAWA DISTRICT OFFICE | C. Tremblay |
| Enquiries and Office | 957-2095 |
| Examinations | |
| 2nd Floor, 360 Lisgar Street | |
| Ed Kutckewich | File No. 900256 |
Dear Sirs:
This is in reply to your memorandum of March 29, 1990, concerning the non-profit status of 24(1) and whether the 24(1) is organized according to the provisions of paragraph 149(1)(1) of the Income Tax Act (the "Act").
From a review of the Constitution and By-laws, it would appear that the 24(1) is exempt from Part 1 Tax under paragraph 149(1)(e) of the Act, that an agricultural organization is an entity organized and operated for one or more of the following purposes: the advancement or furtherance of agricultural; the betterment of the conditions of those engaged in such pursuits; the improvement of the grade or quality of their pursuits or the development of a higher degree of efficiency in their respective occupations.
24(1) would, in our view, be considered to be an agricultural organization. Thus, if this is the case, you need not be concerned about the accumulation of interest as paragraph 149(1)(e) of the Act contains no words similar to those in paragraph 149(1)(1) of the Act that state "...for any other purpose except profit".
We trust our comments are of assistance.
for DirectorBusiness and General DivisionLegislative and Intergovernmental Affairs Branch