Income tax interpretation bulletins (ITs)
Income tax interpretation bulletins are gradually being replaced by a new collection of technical publications called Income Tax Folios.
ITs do not have the force of law
The Canada Revenue Agency (CRA) issued income tax interpretation bulletins (ITs) to provide technical interpretations and positions regarding certain provisions contained in income tax law. Due to their technical nature, ITs are used primarily by our staff, tax specialists, and other individuals who have an interest in tax matters. For those readers who prefer a less technical explanation of the law, we offer other publications such as tax guides and pamphlets.
While the comments in a particular paragraph in an IT may relate to provisions of the law in force at the time they were made, these comments are not a substitute for the law. The reader should consider the comments in light of the relevant provisions of the law in force for the particular tax year being considered, taking into account the effect of any relevant amendments to those provisions or relevant court decisions occurring after the date on which the comments were made.
Subject to the above, an interpretation or position contained in an IT generally applies as of the date on which it was published, unless otherwise specified. If there is a subsequent change in that interpretation or position, and the change is beneficial to taxpayers, it is usually effective for future assessments and reassessments. If, on the other hand, the change is not favourable to taxpayers, it will normally be effective for the current and subsequent taxation years or for transactions entered into after the date on which the change is published.
Complete review of an IT
When there was a complete review of all paragraphs of an IT, the number identifying the IT changed, e.g., IT-178 became IT-178R and upon subsequent review became IT-178R2. The Explanation of Changes section at the end of the IT indicates the paragraph numbers that were changed as a result of the review and provides a short explanation of the reasons for the changes.
In some situations, such as when there was a substantial change in the law or a significant court case, only certain paragraphs of an IT were revised in order to update it as quickly as possible. When such was the case, the word "(consolidated)" appears at the end of the IT number, e.g., IT-178R3 (consolidated). The paragraphs that were revised by the consolidation are identified at the front of the IT beside the heading Latest Revisions. The reasons for all of the changes made since the last complete review of the IT are indicated in the Bulletin Revisions section at the end of the IT. The date of the revision appears after the description of each change.
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