Exclusions - refusal to rule
The CRA is under no obligation to issue an advance income tax ruling. If, in processing a request for an advanced income tax ruling, we become aware of circumstances on which we cannot or will not rule, we will inform the taxpayer of the reasons why the ruling will not be issued. The following, while not an exhaustive list, are most of the circumstances under which we may refuse to rule:
| (a) |
when a transaction is the same in character as a completed transaction entered into by the taxpayer in a prior taxation year and the tax effect of the earlier transaction is under discussion with the taxpayer, in dispute or under assessment or proposed assessment, but is not before the courts; |
| (b) |
when the central issue involves a matter that is before the courts or, if a judgment has been issued, an appeal to a higher court is being considered; |
| (c) |
when the transaction is to be completed at some indefinite future time or where satisfactory evidence is lacking that a proposed transaction is being seriously contemplated; |
| (d) |
when the request for a ruling contains alternative courses of action on the part of the taxpayer; |
| (e) |
when the major issue is whether a transaction should be viewed as being of an income nature or of a capital nature; |
| (f) |
when the matter involved is the determination of fair market value of property; |
| (g) |
when the question concerns tax-related calculations (e.g., the amount of refundable dividend tax on hand at a particular time); |
| (h) |
when a ruling would involve an interpretation of a provision in the Income Tax Act that has not been enacted or would require a regulation and the particular regulation has not been promulgated; |
| (i) |
when a ruling would require an opinion as to generally accepted accounting principles or commercial practices; |
| (j) |
when a matter on which a determination is requested is primarily one of fact and the circumstances are such that all the pertinent facts cannot be established at the time of the request for the ruling. This could include issues involving residence, carrying on of a business and the existence of a partnership; |
| (k) |
when an issue would require an opinion or interpretation of a foreign law; |
| (l) |
when the taxpayer does not consent to the release of the ruling, in severed form, to the public; and |
| (m) |
when the ruling request does not otherwise comply with the requirements of this Information Circular. |
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