24(1) 913512
Bill Guglich
(613) 957-2102
Attention: 19(1)
March 12, 1992
Dear Sirs:
Re: Leasing Property capital cost allowance restrictions
This is in reply to your letter of December 16, 1991 concerning the application of the phrase "throughout the year" contained in the preamble of subsection 1100(16) of the Income Tax Regulations.
It is our view that by virtue of subsection 1100(16) of the Regulations subsection 1100(15) would not apply to a corporation whose principal business was renting or leasing of property throughout the year combined with selling and servicing throughout the year of property of the same general type and description, provided the 90% gross revenue test is met. However, the "throughout the year" condition in subsection 1100(16) of the Regulations would not be met and subsection 1100(15) would apply where a corporation's principal business was renting or leasing of property for part of the year combined with selling and servicing throughout the year of property of the same general type and description.
We trust our comments will be of assistance to you.
Yours truly,
E. Wheelerfor DirectorBusiness and General DivisionRulings DirectorateLegislative and IntergovernmentalAffairs Branch