| 24(1) | 900628 |
| J.A. Szeszycki | |
| (613) 957-2103 | |
| 19(1) | EACC9626 |
September 21, 1990
Dear Sirs:
Re: 24(1) Automobile Allowances
This is in reply to your letter dated March 1, 1990 in which you enclosed a copy of a previous letter addressed to us dated September 14, 1989. As indicated to you by telephone on June 7, we could not find any record of having received your letter of September 14, 1989. As well, we are unable to provide you with an advance income tax ruling on your question since such rulings are only given in respect of proposed transactions as indicated in paragraph 6 of the attached copy of Information Circular IC 70-6R.
As we understand it, 24(1) You provided us with a copy of a ruling request on this subject dated February 24, 189 from the firm and a copy of our reply there to dated May 8, 1989 and asked that we reconsider the views expressed in our May reply in light of the fact that by 24(1) As we mentioned to you on June 7, automobile allowances, in excess of "reasonable" amounts, that are received by an employee are required to be included in the employee's income under paragraph 6(1)(b) of the Act. Subparagraph 6(1)(b)(x) of the Act specifically provides that automobile allowances shall be deemed to be in excess of a "reasonable" amount where the measurement for the use of the vehicle is not based solely on the number of kilometres driven for business purposes.
24(1) we are unable to alter the views expressed in our letter of May 8, 1989 to 24(1)
As agreed, we delayed providing you with this response until after the tabling of the Technical Bill by the Department of Finance this summer in case there was any change that would affect our views. We have now had the opportunity to examine this legislation and regret to advise you that there are no substantive changes to the above-mentioned provisions, consequently, the views expressed in our letter of May 8, 1989 remain valid.
24(1) We have advised Mr. Ian Grant, Acting Chief of Enquiries and Office Examination, at the Scarborough District Office to look into this problem and contact you.
We trust that this letter explains the reasons for our position on this matter. If you have any further questions, please do not hesitate to contact us. Your deposit of $325.00 in respect of the advance ruling requested will be returned to you under separate cover.
Yours truly,
for DirectorBusiness and General DivisionSpecialty Rulings DirectorateLegislative and Intergovernmental Affairs Branch
c.c. Mr. Ian Grant A/Chief, Enquiries and Office ExaminationScarborough District Office