| 19(1) | 5-902270 |
| W.C. Harding | |
| (613) 957-8953 |
Personal and Confidential
October 29, 1990
Dear Sir:
This is in reply to your facsimile submission to the Department's Taxpayer Assistance Division dated August 13, 1990 concerning elections under subsection 147(10.1) of the Income Tax Act (the "Act") which was transferred to us for reply on August 29, 1990.
After considering the details provided by you, we must agree that, although you are entitled to make an election, it will have only a limited benefit to you since the value of any shares which you may receive will, at the time of receipt, have a value equal to their cost to the DPSP. In this case the election will not allow you to defer taxation of any amount or claim a deduction under paragraph 110(1)(d.3) of the Act but will only allow you to transfer the shares to an RRSP using the provisions of paragraph 60(j) of the Act.
While we appreciate your position in this matter, the Act is very specific in this regard and unfortunately does not provide any discretion which would allow the election to be made for any other value.
We regret not being of more assistance in this matter.
Yours truly,
for DirectorFinancial Industries DivisionRulings Directorate