Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.
Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the Department.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle du ministère.
T. Murphy
XXXXXXXXXX 613 (957-8953)
952067
August 22, 1995
Dear Sir:
Re: Year-End of an Estate
Your letter of August 3, 1995, to Mr. Denis Lefebvre has been forwarded to us for reply. In your letter you enquired whether an estate which holds shares of a corporation and which receives rental income from that corporation would be required to change its year-end to December 31.
In July, 1995, the Minister of Finance released draft legislation to amend the definition of fiscal period in the Income Tax Act (the "Act"). The revised definition introduces new restrictions on the timing of fiscal periods. Draft subparagraph 249.1(1)(b)(i) of the Act applies to individuals other than testamentary trusts. A testamentary trust is defined in subsection 108(1) of the Act as a trust or estate which arose on and as a consequence of the death of an individual (subject to the specific exceptions set out in the definition). Draft paragraph 104(23)(a) of the Act, pertaining to the taxation year of a testamentary trust, does not require a December 31 taxation year. Thus, in response to your question, there is no requirement for an estate (a testamentary trust by definition) to change its year-end to December 31.
We trust our comments will be of assistance to you.
Yours truly,
R.S. Biscaro
Director
Manufacturing Industries, Partnerships
and Trusts Division
Income Tax Rulings and
Interpretations Directorate
Policy and Legislation Branch
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