| Mr. Edward Tamagno | |
| Assistant Director General | HBW 4131-N1 |
| Management, Planning and | Al Watson |
| Foreign Affairs | 957-2072 |
| Health and Welfare Canada | |
| Ottawa, Ontario | EACC9605 |
| K1A 0L1 |
September 24, 1990
Dear Mr. Tamagno:
This is further to recent discussions concerning a question raised by the 24(1). The question a posed is as follows.
"Does Canada allow a foreign tax credit for taxes withheld from Dutch social security benefits paid to a resident of Canada?"
To confirm our answer as stated by phone, there would be no foreign tax credit allowed as no Canadian taxes are attributable to that foreign source (reference: paragraph 126(1)(b) of the Income Tax Act). A tax deduction may be allowed under subsection 20(12) of the Income Tax Act as presently worded. In this regard we have enclosed a copy of Interpretation Bulletin 506 for your reference.
21(1)(b)
In conclusion, we would like to receive a copy of any correspondence you may have received from the 24(1) which concerns taxation matters.
Yours sincerely,
Christine SavageActing DirectorProvincial and International Relations Divisionattachment
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