CRA finds that “proceeds” of property for s. 55(3)(a)(i)(B) purposes were the deemed s. 69 “proceeds of disposition”

The carve-out in s. 55(3)(a)(i)(B) - from what otherwise would be a disposition of property to an unrelated person which was tainted under s. 55(3)(a)(i) – rather curiously refers to a disposition of the property for "proceeds" that are not less than its fair market value, rather than using the defined phrase "proceeds of disposition."  CRA nonetheless considers that where the property is disposed of for actual proceeds of nil, but is deemed by s. 69(1)(b)(ii) to be disposed of for FMV proceeds of disposition (because it is a gift), the s. 55(3)(a)(i)(B) carve-out will be satisfied.

Neal Armstrong.  Summary of 11 February 2015 T.I. 2014-0557251E5 F under s. 55(3)(a).