5 July 1990 Income Tax Severed Letter AC74701 - Fellowship Awards to Non-residents

Non-Resident Taxation Division      Rulings Directorate
                                    M.P. Sarazin
K. Hillier                          957-2125
Director

                                    7-4701

Subject: Fellowship Awards to Non-residents File HDB 1486-2

This is in reply to your memorandum of February 2, 1990 regarding the taxability of fellowship income awarded to non-residents who are engaged in post-doctoral work in Canada.

It is our understanding that 24(1)

You would like to determine whether or not the non-resident individual is subject to tax an fellowship income received from 24(1). In other words, would the provision of subsection 115(2) of the Act apply.

In our view, 24(1)

We refer you to our memorandum to J. Hartwick of your division dated March 17, 1990 where we describe our rationale for concluding that a taxpayer described in subsection 149(1) is a "taxpayer subject to tax under Part I of the Act" as required under paragraph 115(2)(c.1) of the Act.

24(1) We should, however point out that the terms of any resident would have to be reviewed to determine whether the convention would override the provisions of the Act.

If the non-resident individual completes the tenure of the fellowship then the individual will be deemed to be a resident of Canada under subsection 250(1) of the Act in the years where he or she has sojourned in Canada for 183 days or more. As a deemed resident, the individual will be subject to tax on his or her world income under subsection 2(1) of the Act.

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