2015-0585381I7 Paragraph 95(2)(k) - Fresh Start Rules

Principal Issues: Whether the decision in the Standard Life Assurance Company of Canada case has changed our conclusion in document 2014-0536581I7.

Position: No.

Reasons: There are substantial differences in interpreting the provisions of subsection 138(11.3) and paragraph 95(2)(k) of the Act in accordance with the textual, contextual and purposive approach developed by the jurisprudence and in the context of the relevant facts in the Standard Life Assurance Company of Canada case and our document 2014-0536581I7.

Author: Hikspoors, Maryann
Section: 95(2)(k); 95(2)(k.1); 138(11.3)

                                                                      November 5, 2015

XXXXXXXXXX                                              HEADQUARTERS
XXXXXXXXXX TSO                                      Income Tax Rulings
                                                                      Directorate
                                                                      Maryann Hikspoors

                                                                      2015-058538

Standard Life Assurance Company of Canada and paragraphs 95(2)(k) and (k.1)

This is in response to your e-mail of May 6, 2015, requesting our view as to whether the decision rendered in the Tax Court of Canada case of the Standard Life Assurance Company of Canada, 2015 TCC 97, (“Standard Life case”) that interpreted the provisions of subsection 138(11.3) has changed our conclusions in the previously issued document 2014-053658 concerning our interpretation of paragraphs 95(2)(k) and (k.1) of the Income Tax Act (“Act”).

Based on our analysis of the Standard Life case and our interpretation of paragraph 95(2)(k) of the Act in accordance with the textual, contextual and purposive approach developed by the jurisprudence, we are of the view that there are substantial differences in interpreting the provisions of subsection 138(11.3) and paragraph 95(2)(k) of the Act, as applicable to the relevant facts in the Standard Life case and document 2014-053658. As a result, our conclusions previously reached in document 2014-053658 remain unchanged.

We trust these comments will be of assistance.

Yours truly,

Vitaliy Anissimov
Section Manager
for Division Director
International Division
Income Tax Rulings Directorate
Legislative Policy & Regulatory Affairs Branch

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