13 June 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
658223
Extra import data
{
"field_external_guid": [
"menu:://Federal Income Tax [CCH Tax ]/Tax Window Files/Tax Window Files/Tax Window Files/1990s/1991 [JN91_149.150 - MA91_334.338]/JN91_158 — Superannuation Fund"
],
"field_proprietary_citation": [],
"field_release_date_new": "1991-06-13 08:00:00",
"field_tags": []
}
Main text

June 13, 1991

TO WINNIPEG DISTRICT OFFICE        FROM HEAD OFFICE
Mr. R. Reich                       Financial Industries
Chief of Verifications               Division
  and Collections                  P. Spice
                                   (613) 957-8953
Attn: Deborah O'Grady
                                   7-911298
     24(1)Superannuation Fund (the "Fund")

We are writing in reply to your memorandum of February 6, 1991, and your facsimile transmission of February 26, 1991, referred to us by Taxpayer Assistance Section, Assessing and Enquiries Directorate, on May 9 and May 14, 1991, respectively. You asked whether employee contributions to the above noted Fund result in the application of the RRSP deduction limits set out in paragraph 146(5)(a) or to the limits set out in paragraph 146(5)(b) of the Income Tax Act (the "Act") as those provisions read for the taxation years 1987 through 1990.

If a taxpayer employee is the only person who contributes to the Fund in respect of his or her employment in 1987 and 1988, then the higher deduction limits in paragraph 146(5)(b) of the Act apply for RRSP contributions for those taxation years. However, in the situations you describe it is not possible to determine in 1987 and 1988 whether employer contributions in subsequent years (i.e. after retirement) will or might relate to the taxpayer employee's employment in 1987 and 1988. Therefore, the lower limits in paragraph 146(5)(a) of the Act apply.

With respect to the 1989 and 1990 taxation years the employee was "employed in the year" and "as a consequence therefore ... may become entitled to benefits under" the Fund in respect of (his/her) employment in the year". In these cases the employees may receive a benefit after retirement in the form of a refund of contributions made in 1989 and 1990 and, therefore,the limits in paragraph 146(5)(a) of the Act apply.

A copy of this memorandum is being forwarded to the Taxpayer Assistance Section and they will contact you with respect to your queries concerning adoption of an administrative position and adjustments for prior years.

We trust the foregoing explanation assists you.

for Director Financial Industries Division Rulings Directorate

c.c.: Michel Proulx
      Enquiries and Taxpayer Assistance
         Division
                                                           000158