January 13, 1988
TO Halifax District Office Audit Division R.J. Burns
Head Office Financial Industries Division Peter K. Noack (613)957-8963
RE: XXXX
We have been asked by our Audit Division to reply to your memorandum of November 24 on the above subject.
In our opinion, the terms of the above trust constitute an "employee benefit plan" as defined in subsection 248(1) of the Act. We had indicated as much in our letter to XXXX. Payments out of an "employee benefit plan" must be included in the income of the recipient under paragraph 6(1)(g) except the portions referred to in subparagraphs i), ii) and iii) of the subsection. "Retiring allowances" as defined in subsection 248(1) are included in the income of the recipient under paragraph 56(1)(a)(ii) (other than amounts received out of an "employee benefit plan"). In other words, a "retiring allowance" that is paid out of an "employee benefit plan" will be included in the income of the recipient under paragraph 6(1)(g) as a payment out of an "employee benefit plan". Therefore, the rollover provisions in paragraph 60(j.1) would not be available for such payments.
for Director Financial Industries Division Rulings Directorate