Revenu Canada Taxation Head Office
G. Kauppinen (613) 957-3495
December 21, 1988
Dear Sirs:
This is in reply to your letter dated November 17, 1988 wherein you requested an advance income tax ruling on behalf of XXXX.
We are unable to rule since your request does not involve a specific proposed transaction. Consequently, your deposit will be returned under separate cover.
We are, however, prepared to offer the following general comments regarding qualified investments for registered retirement savings plans ("RRSPs"), registered retirement income funds ("RRIFs") and deferred profit sharing plans ("DPSPs") (the "Plans").
Bonds described in clause 212(1)(b)(ii)(C) of the Income Tax Act ("Act") will be qualified investments for a RRSP, RRIF and DPSP pursuant to paragraphs 146(1)(g)(i) and 146.3(1)(d)(i) of the Act and subparagraph 204(e)(ii) of the Act respectively.
Where, in respect of a bond, the principal amount and each interest payment payable are sold separately, it is our opinion that the principal amount of the bond would be a qualified investment for the Plans at the time it is sold. Moreover, in our view, the interest payable on the bond would also be a qualified investment for the Plans even before the interest is actually due and payable. Such amounts would be considered to be "similar obligations" within the meaning of that term as contained in clause 212(l)(b)(ii)(C) of the Act.
The foregoing is an expression of opinion only and is not binding on this Department.
Yours truly,
for Director Financial Industries Division Rulings Directorate