CRA finds that a discretionary trust can in effect allocate a safe income dividend received by it to a corporate beneficiary

Opco pays a dividend on shares held by a discretionary trust equal to the safe income on hand of those shares, and the trust then distributes and allocates all of the dividend to a corporate beneficiary ("Holdco"), with the amount being deemed to be a dividend in Holdco’s hands as a result of a s. 104(19) designation.  CRA accepts that "it would be reasonable to consider that the amount of the dividend allocated to Holdco…would be increase its safe income by an equivalent amount."

Neal Armstrong. Summary of 10 October 2014 APFF Roundtable, Q. 7, 2014-0538061C6 F under s. 55(2).