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Attention: XXXXXXXXXX
Dear Sirs:
RE: Paragraph 94.1(1)(a)
This is in reply to your letter dated September 4, 1991 in which you requested a technical interpretation regarding the application of paragraph 94.1(1)(a). We apologize for the lengthy delay in responding.
Section 94.1 is an avoidance provision. It interacts with section 94 and the rules relating to foreign accrual property income. Many of the trust arrangements we have reviewed have been structured so as to potentially avoid the application of subsection 75(2). The hypothetical fact pattern you have described is fairly narrow. As the application of these provisions and the general anti-avoidance rule depends on a full understanding of all of the relevant facts pertaining to a particular situation we would prefer not to comment on the situation you have described.
In future, if you have a particular case in mind and can provide us with full disclosure of the relevant facts and proposed transactions we would be pleased to deal with your request on a rulings basis.
Yours truly,
for DirectorReorganizations and Foreign DivisionRulings DirectorateLegislative and Intergovernmental Affairs Branch