Principales Questions: Where a first trust makes designation pursuant to subsections 104(21) and 104(21.2) with respect to an amount paid to a second trust, whether the second trust can make a designation pursuant to subsection 104(21.2) with respect to the same amount paid to its own beneficiaries?
Position Adoptée: No.
Raisons: The preamble of subsection 104(21) provides that it does not apply for the purpose of section 110.6. Consequently, the amount of net taxable capital gains designated by the first trust pursuant to subsection 104(21) is not included in the second trust's "eligible taxable capital gains" as defined in subsection 108(1) which refers to the "annual gains limit" as defined in subsection 110.6(1).