Income Tax Severed Letters - 2024-01-10

Ruling

2022 Ruling 2022-0933091R3 - Single-Wing Split-Up Butterfly

Unedited CRA Tags
55(2), 55(3)(b), 55(3.1), 55(3.2)(e), 55(3.2)(g), and 55(5)(e)

Principal Issues: Whether the butterfly dividends are exempt from subsection 55(2) by virtue of satisfying the requirements of paragraph 55(3)(b).

Position: Yes.

Reasons: Proposed transactions satisfy the requirements of paragraph 55(3)(b).

Technical Interpretation - Internal

8 September 2023 Internal T.I. 2023-0987091I7 - Trailing Commissions and Dealer Rebates

Unedited CRA Tags
12(1)(x); 12(2.1)
Summary Under
Tax Topics - Income Tax Act - Section 12 - Subsection 12(2.1)
trailer commissions which are temporarily paid by MFT to OEO dealer for it to fund rebates to client MFT unitholders are s. 12(1)(x) inclusions to MFT
Summary Under
Tax Topics - Income Tax Act - Section 12 - Subsection 12(1) - Paragraph 12(1)(x)
trailer fee rebates paid by dealer to MFT unitholder clients were s. 12(1)(x) inclusions to the MFT

Principal Issues: Whether the CRA would be able to provide an interpretation that a certain rebate to be paid by a dealer to unitholders in a mutual fund trust would not be included in the income of the mutual fund trust pursuant to paragraph 12(1)(x) and subsection 12(2.1) of the Act.

Position: No, the CRA would not be able to provide such a technical interpretation.

Reasons: The wording of paragraph 12(1)(x) and subsection 12(2.1) are such that these provisions might apply in the situation described.