| 921948 | |
| A. Humenuk | |
| (613) 957-2134 |
19(1)
September 23, 1992
Dear 19(1)
We are replying to your letter dated May 14, 1992 concerning the taxation of refunds of provincial income tax paid by the Province of British Columbia to qualifying individuals in accordance with the applicable provisions of the International Financial Business (Tax Refund) Act of British Columbia (the "Tax Refund Act"). We apologize for the delay in response.
As indicated in our previous correspondence to you of June 19, 1992 from the Financial Industries Division, we can only comment generally on our interpretation of the law and not in relation to specific taxpayers since it is the responsibility of the District Taxation Offices to review completed transactions and make determinations in light of the facts of each case.
Paragraphs 5(1)(b) and (c) of the Tax Refund Act provide for certain individuals to receive refunds in respect of provincial tax paid to them on income earned from employment with a registered financial institution. You have asked whether this refund of provincial tax is required to be included in the employee's income under any provision of the federal Income Tax Act.
It is our understanding of the Tax Refund Act that the tax refunds paid to individuals under this Act will only be issued to those individuals in their capacity as employees of a registered financial institution. Provided our understanding is correct, the refund of tax to those employees under the Tax Refund Act will be required to be included in the employee's income under paragraph 6(1)(a) of the Income Tax Act.
We trust our comments will be of assistance to you.
Yours truly,
P.D. Fuocofor DirectorBusiness and General DivisionRulings DirectorateLegislative and IntergovernmentalAffairs Branch
c.c. Provincial and International Relationsc.c. Vancouver District Officec.c. Assessment of Returns Directoratec.c. Client Assistance Directorate