| 24(1) | 900903 |
| M. Eisner | |
| (613) 957-2138 | |
| Attention: 19(1) | EACC9305 |
August 15, 1990
Dear Sirs:
Re: Advance Income Tax Ruling 19(1)
In your letter of July 31, 1990, you advised us that you wish to withdraw the advance income tax ruling requested on behalf of the above two individuals. Accordingly, we have enclosed our file.
An invoice for the time spent in reviewing the advance income tax ruling request will be sent to you under separate cover.
Yours truly,
B.W. DathDirectorBusiness and General DivisionRulings DirectorateLegislative and Intergovernmental Affairs Branch
Issue
Two individuals operate two convenience stores in partnership. The two individuals manage one of the stores and have hired a manager to manage the second store. However, the two individuals oversee the operations of the second store.
The two individuals propose to transfer the assets used in o operating the second store to a corporation. With respect to this situation, paragraph 110.6(14)(f) provides that shares issued by the corporation are deemed to have been owned by an unrelated person for the purposes of the qsbcs definition in subsection 110.6(1) unless all or substantially all of the assets used in an active business are transferred to the corporation. The issue is whether the two convenience stores comprise one or two businesses.
Decision
Consistent with case law (e.g. Pevato 65 DTC 5183) in which a single business has been interpreted in a broad manner, only one business is involved.