5-913074
Dear Sir:
Re: Paid Leave of Absence Plans Section 6801 of the Income Tax Regulations
This is in response to your letter of October 31,1991 requesting our interpretation of clause 6801(a)(iii)(A)of the Income Tax Regulations ("the Regulations").
In our opinion the meaning of clause 6801(a)(iii)(A) of the Regulations is that during the leave of absence the employee can not receive any wages or salary from the employer or a person related to the employer except the amount of salary that was deferred over the deferral period or a salary which is based on a fixed percentage of their salary both during the deferral period and the leave of absence.
Based on the above definition only the first interpretation noted in your letter would be permitted in order for a plan to qualify under section 6801 of the Regulations.
We trust the above comments will be of assistance to you.
Yours truly,
for DirectorFinancial Industries DivisionRulings DirectorateInformation Act l'information