Submissions and Consultations

CALU's Submission to Finance: Employee Life and Health Trusts

The Department of Finance Canada has released draft legislation amending the Income Tax Act to address Employee Life and Health Trusts. The legislation would give legislative effect to most of the CRA's current administrative guidelines for Health and Welfare Trusts and clarify the tax treatment for trusteed benefit plans. However, the legislation also contains proposals which, while they attempt to address perceived abuses, would, in CALU's opinion, discourage the use of ELHTs in the small business sector, to the detriment of employees and employers. CALU's submission identifies these concerns and suggests solutions to these problems.

CALU's Exempt Test Submission to Finance

On November 10, 2009, CALU made a submission to the Department of Finance Canada relating to possible changes to the exempt test as a result of discussions that have taken place over the past two years or so. (Click on the PDF file below to view a copy of the submission.) The submission essentially summarizes CALU´s position on various issues relating to the current exempt test rules and related topics.

CALU Tax Bulletin 2009

The Canada Revenue Agency (CRA) recently announced a change in assessing practice that will affect certain planning structures involving corporate owned insurance. The purpose of this bulletin is to review the announced changes and how they will affect current and new insurance structures.

Disability Benefits under UL policies: CALU submission to CRA 2009

On April 1, 2009, CALU wrote to the Canada Revenue Agency (CRA) about a December 2008 CRA Technical Letter which questioned whether the payment of disability benefits under a universal life policies from the accumulating fund was in fact a disability benefit for income tax purposes. Our arguments are similar to the arguments CALU made in 2000 with respect to payments made at the first death under a joint last-to-die policy.

Transfer of a Life Policy and Capital Dividend Account: CALU recommendations to Finance 2009

CALU has written to the Department of Finance to recommend changes to the Income Tax Act which would accommodate the transfer of a life insurance policy from a shareholder to a corporation under the relevant section of the Act, as well as to allow a private corporation which was the beneficiary of a life insurance policy owned by a trust to have the death benefit credited to its capital dividend account.

Taxation of Long Term Care and Critical Illness Insurance

In a joint submission, CALU and the CLHIA summarized product features of Critical Illness and Long Term Care insurance policies, the industry's current understanding of tax law and how it applies to such products, and then sought to outline issues for discussion with a view to possible courses of action where tax policy needs to be confirmed.