CRA states that all capital distributions made by Canadian-resident trusts to non-resident beneficiaries must be reported on NR4s

Although s. 212(11) somewhat confusingly deems all trust capital distributions to a non-resident beneficiary to be income distributions for Part XIII purposes, s. 212(1)(c) only imposes Part XIII tax on s. 104(13) income and capital dividend distributions. However, CRA resorts to the broad literal wording of s. 212(11) when it comes to NR4 reporting and requires a Canadian-resident trust to report all capital distributions made to a non-resident beneficiary on the form.

Neal Armstrong. Summary of 22 December 2016 External T.I. 2015-0608201E5 Tr under Reg. 202(1)(c).