| December 4, 1990 | |
| Source Deductions Division | Business and General |
| Division | |
| S. Short | |
| (613) 957-2134 | |
| Attention: Mr. A. Bissonnette | |
| A/Director | 902563 |
SUBJECT: Bridge Financing on Relocation of Employees
Attached is a recent enquiry concerning the Department's administrative position in situations where an employer provides no interest or low interest "bridge" financing to an employee who is relocated and buys a home at the new work location before selling his/her home at the old work location.
The question asked is whether or not an employee will be assessed a taxable benefit in respect of such bridge financing where the loan is only outstanding for the period between the purchase of the new home and the sale of the former one and every reasonable effort is made to sell the former home.
In the attached memo dated December 6, 1984, your Division adopted the view that employees are not considered to have received a taxable benefit from such bridge financing where the loan was for the amount of equity in the employee's former home. Our response, also attached, did not object to this position. TOM 3642(G), which deals with this point, makes no mention of a limit on the amount of the bridge financing.
21(1)(b)
We would appreciate it if you would respond to 24(1) letter and forward us a copy of your reply for our records.
Yours truly,
B.W. DathBusiness and General DivisionRulings DirectorateLegislative and Intergovernmental Affairs Branch
Attachments (3)