4 July 1989 Income Tax Severed Letter AC58056 - Lease

By services, 22 July, 2022
Official title
Lease
Language
English
Document number
Citation name
AC58056
Severed letter type
Miscellaneous
d7 import status
Drupal 7 entity type
Node
Drupal 7 entity ID
657095
Extra import data
{
"field_external_guid": [],
"field_proprietary_citation": [],
"field_release_date_new": "1989-07-04 08:00:00",
"field_tags": []
}
Main text
5-5806
                                            Peter Lee
                                            (613) 957-2745

July 4, 1989

Dear Sir:

Re: Lease

We are writing in reply to your letter of May 10, 1989, wherein you requested our opinion with respect to a "lease" with a "guaranteed residual value" clause.

Whether a transaction is a lease or a disposition for purposes of the Income Tax Act depends on the actual legal rights and obligations of the parties involved in the transaction, and not merely on the intention of the parties. If the conditions of an agreement are similar to those in paragraph 3(b) of IT-233R , the agreement is generally not considered to be a lease. IT-233R is under review by the Department, but it remains effective until it is revised or cancelled.

Yours truly,

for Director Financial Industries Division Rulings Directorate