| January 26, 1990 | |
| TO - EDMONTON DISTRICT OFFICE | FROM - HEAD OFFICE |
| H.S. Lee | Technical Interpretations |
| Director | Division |
| Esta Mikhail | |
| Tel. (613) 952-3606 | |
| File No. 4-0855 |
SUBJECT: 19(1)
We have been asked by 19(1) Member of Parliament, the Honourable David Kilgour, to consider certain taxes payable by them arising from a gain on the sale of certain shares in 1981 for a remission of tax under the Financial Administration Act. We enclose copies of all correspondence that we received relating to this matter for your perusal.
In order that the Remission Committee may be able to consider the matter and apply the guidelines in TOM 2263.22, would you kindly submit to this Division a report containing the information required under TOM 2263.24(2)(A) to (G).
Since we are not familiar with 19(1) situation, we do not know whether each case should be considered as an "extreme hardship" case (TOM 2263.22(2)(A)) or as a "financial setback" case (TOM 2263.22(2)(C)). If in your judgement the case is one of "extreme hardship" would you kindly consider whether the comments in TOM 2263.22(5) apply. If the case is one of "financial setback" would you kindly consider whether the comments in TOM 2263.22(12) apply. In particular, we would appreciate being advised on the following matters:
- details of the gain on the sale of shares and how it was reported for income tax purposes;
- were the taxpayers entitled to claim a reserve in respect of the gain and the reason the reserve was not claimed;
- amount of both the federal and provincial tax applicable to the gain to be considered for remission assuming the taxpayer are judged eligible;
- what are the circumstances on which to judge whether a denial of the remission would represent hardship or a financial setback caused by events beyond the taxpayers' control;
- amount of unpaid taxes as of now in respect of the taxation year in which the gain was originally reported; and
- do the remission guidelines described in TOM 2263.23(2)(B), (C) or (D) apply to deny a remission.
Please include 19(1) tax return, copies of correspondence and notes of conversations with the taxpayers and any other facts and documents relating to the issue of remission of tax.
Thank you for your assistance in this matter.
Bernhard BuetowActing DirectorTechnical Interpretations DivisionLegislative and Intergovernmental Affairs Branch
Enclosure
STALLED