6 February 1991 Income Tax Severed Letter

By services, 22 July, 2022
Language
English
Document number
Severed letter type
Miscellaneous
d7 import status
Drupal 7 entity type
Node
Drupal 7 entity ID
657583
Extra import data
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"menu:://Federal Income Tax [CCH Tax ]/Tax Window Files/Tax Window Files/Tax Window Files/1990s/1991 [FE91_227 - JA91_325.335]/FE91_227 — \\\"Foreign Property\\\""
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"field_proprietary_citation": [],
"field_release_date_new": "1991-02-06 07:00:00",
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}
Main text

February 6, 1991

Enquiries and Taxpayer                  Financial Industries
  Assistance                            M. Shea-DesRosiers
                                        957-8953

Renata Bujack Taxline

                                        903364

"Foreign property" Subsection 206(1) of the Income Tax Act

This is in reply to your memorandum of November 23, 1990 with documents attached and further to our telephone conversation (Bujak/Shea-DesRosiers) of December 18, 1990 concerning the above-mentioned subject.

It is our opinion that Canadian Government Treasury Bills denominated in a currency other than Canadian (for ex., U.S., German, Swiss) do not constitute foreign property for the purposes of the Part XI Tax.

Furthermore, investment income and proceeds of disposition of such investments are not considered to be foreign property provided they are immediately converted to Canadian currency or promptly used to acquire property that is not foreign property.

On the other hand, if the Treasury Bills are from different countries (ex., U.S.A. Government Treasury Bills, Japan Government Treasury Bills) they would constitute foreign property as defined in subsection 206(1) of the Income Tax Act and thus be subject to Part XI tax.

We trust the above comments will be of assistance to you.

for Director Financial Industries Division Rulings Directorate

c.c.: Coreen Drescher Calgary D.O.

000227