2024 Ruling 2023-0968421R3 - First Nations Trust

Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.

Principal Issues: 1. Whether subsection 75(2) will apply to any income or loss from the Compensation Balance received by the Trust as described in Paragraph 13, or from property substituted therefor, and any taxable capital gain or allowable capital loss from the disposition of the Compensation Balance, or property substituted therefor. 2. Whether the trust will be able to make deductions under subsection 104(6) in respect of Annual Income of the Trust for a Taxation Year, excluding any income in respect of which subsection 75(2) applies, paid by the Trust to the First Nation during the Taxation Year under subsections XXXXXXXXXX of the Trust Agreement, and, after the Original Capital Use Date, under subsection XXXXXXXXXX of the Trust Agreement? 3. Where any property of the Trust is distributed by the Trust to the First Nation and there is a resulting disposition of all or any part of the First Nation’s capital interest in the Trust, will subsection 107(2) apply? 4. Will the payment of initial per capita distributions from the First Nation to its members be taxable?

Position: 1. Yes, such income shall be deemed to be income or a loss, as the case may be, or a taxable capital gain or allowable capital loss, as the case may be, of the First Nation, pursuant to subsection 75(2). 2. Such income will be considered to have become payable in the Taxation Year to the First Nation and may be deducted in computing the taxable income of the Trust for the Taxation Year pursuant to 104(6)(b). Income paid by the Trust to the First Nation pursuant to those subsections of the Trust Agreement during a Taxation Year will be considered to be sourced first from income in respect of which subsection 75(2) does not apply. 3. Yes, subject to subsections 107(2.001), (2.002) and (4) to (5), subsection 107(2) will apply. 4. No.

Reasons: 1. The First Nation will be the settlor of the Trust, directing Canada to make payments to the Trust on behalf of the First Nation. The First Nation is the sole beneficiary and on the termination of the Trust, all of the Trust’s property will be transferred to the First Nation. 2. Such amounts will be considered payable to the Beneficiary pursuant to subsection 104(24). 3. The law. 4. The payment of the initial per capita distributions is not considered income from a source within the meaning of paragraph 3(a), another source of income under subdivision d, or a disposition of property. Therefore, the initial per capita distributions received by the Members of the First Nation would not be included in calculating their income under Part I of the Act.

XXXXXXXXXX 2023-096842

Dear XXXXXXXXXX:

Re: Advance Income Tax Ruling
XXXXXXXXXX

This is in reply to your letter of XXXXXXXXXX, in which you requested an advance income tax ruling (“Ruling”) on behalf of the above-named taxpayers. We also acknowledge the information provided in subsequent correspondence and during our various telephone conversations in connection with your request.

We understand that, to the best of your knowledge and that of the taxpayers involved, none of the Subject Transactions or issues involved in the Ruling request are the same as or substantially similar to transactions or issues that are:

(i) in a previously filed tax return of the taxpayers or a related person and:

a. being considered by the CRA in connection with such return;

b. under objection by the taxpayers or a related person; or

c. the subject of a current or completed court process involving the taxpayers or a related person; or

(ii) the subject of a Ruling request previously considered by the Income Tax Rulings Directorate.

This document is based solely on the facts and Subject Transactions described below. The documentation submitted with your request does not form part of the facts and Subject Transactions except as expressly referred to herein, and any references thereto are provided solely for the convenience of the reader.

DEFINITIONS

Unless otherwise stated:

i. all references to a statute are to the relevant provision of the Income Tax Act, R.S.C. 1985 (5th Supp.), c.1, as amended, (the “Act”), or, where appropriate, the Income Tax Regulations, C.R.C., c.945, as amended, (the “Regulations”);

ii. all terms and conditions used in this Ruling request that are defined in the Act (or in the Regulations) have the meaning given in such definition;

iii. all references to monetary amounts are in Canadian dollars; and

iv. the singular should be read as plural and vice versa where the circumstances so require.

The following abbreviations, terms and expressions have the meanings specified, and the relevant parties to the Subject Transactions will be referred to as follows:

(a) “Adult Member” has the meaning described in Paragraph 17;

(b) “Annual Income” means the income of the Trust for a Fiscal Year as such income is computed in accordance with the Act, but without reference to subsection 75(2), paragraph 82(1)(b) and subsection 104(6);

(c) “Authorized Expenses” means the expenses reasonably incurred by the Trustee in each Fiscal Year in carrying out the terms of the Trust Agreement, including the Trustee’s expenses as set out in the Trustee Services Agreement and the payment of administrative, accounting, legal, investment, audit, and other costs, including those costs associated with amending or terminating the Trust Agreement, but excluding costs incurred by the First Nation, including any costs of the Council, the Council members or the First Nation’s administration incurred in performing any of its obligations in relation to the operation of the Trust;

(d) “Authorized Investment” means an investment in securities purchased with funds from the Trust Account, in accordance with the Trust Agreement and consisting of the investments listed in XXXXXXXXXX of the Trust Agreement;

(e) “Beneficiary” means the First Nation, as the beneficiary of the Trust, including all Members of the First Nation on a collective and undivided basis, as represented by its duly elected Council;

(f) “Canada” means His Majesty the King in right of Canada;

(g) “Chief” means the Chief of the First Nation;

(h) “Claims” has the meaning described in the Settlement Agreement;

(i) “XXXXXXXXXX Development” means expenditures by the First Nation for the benefit of the First Nation and/or its Members, including expenditures for programs, services, XXXXXXXXXX infrastructure and any other assets and/or initiatives, but not including XXXXXXXXXX Development initiatives, that have the objective of enhancing the quality of life of the First Nation and its Members;

(j) “Compensation Balance” means the aggregate compensation ($XXXXXXXXXX) paid by Canada to the First Nation pursuant to the Settlement Agreement and deposited by Canada, on behalf of the First Nation, into the Trust Account;

(k) “Council” means the duly elected Chief and council of the First Nation, which is also a “council of the band” as defined in subsection 2(1) of the Indian Act;

(l) “CRA” means Canada Revenue Agency;

(m) “XXXXXXXXXX Development” means the expenditure of funds by the First Nation in and for any initiative, project, venture, activity or undertaking the primary purpose of which is to generate profit, which project has under gone appropriate due diligence by the First Nation, including the First Nation engaging the services of a Chartered Professional Accountant or firm of Chartered Professional Accountants (or such successor or replacement designation) authorized to practice in the Province of XXXXXXXXXX and that is independent of the Council and the Trustee, to prepare a business plan, feasibility study or other reports that will support the viability of the business venture;

(n) “Effective Date” has the meaning described in Paragraph 11, which took place on XXXXXXXXXX;

(o) “Financial Institution” means a bank, trust company or credit union which is authorized by law to accept deposits and which is supervised and regulated by the Superintendent of Financial Institutions as defined in the Office of Superintendent of Financial Institutions Act, (Canada) and duly licensed to conduct business in the Province of XXXXXXXXXX;

(p) “First Nation” means the XXXXXXXXXX, a band within the meaning of the Indian Act, which is a body of persons made up of the Members and governed by decisions of the Council or of the voting Members (in accordance with the Indian Act and its laws and policies);

(q) “Fiscal Year” means the 12-month period commencing on January 1 and ending December 31 in each calendar year, provided that the initial Fiscal Year shall be the period from the Effective Date until December 31 of that same calendar year;

(r) “XXXXXXXXXX Account” means an account to be established by the Council on behalf of the First Nation at a Financial Institution for the purpose of receiving transfers from the Trust Account made under XXXXXXXXXX of the Trust Agreement and which account shall be maintained by the Council pursuant to the terms of the Trust Agreement;

(s) “Holding Corporation” has the meaning described in the Trust Agreement;

(t) “Indian Act” means the Indian Act, R.S.C. 1985, c. I-5, as amended, and the regulations made pursuant to that act;

(u) “Land Acquisition Costs” means all reasonable costs associated directly with and incurred by the First Nation in relation to purchasing New Acres including, without limitation;

a) the identification and selection of New Acres, including:

• costs related to appraisals, environmental assessments and environmental mitigation; and
• costs of hiring employee(s) or agent(s) to assist with the purchase of New Acres and having any New Acres purchased set apart as a reserve;

b) a board or committee established by the Council to assist the Council with the land acquisition process;

c) applicable taxes and tax adjustments required to be paid under an agreement to purchase;

d) all land titles costs, including search costs and land transfer taxes;

e) legal fees and costs, surveyor costs and real estate commissions;

f) all closing costs necessary to discharge third-party interests;

g) property taxes and other reasonable expenses incidental to the ownership of New Acres and associated improvements until such time as the New Acres and improvements are placed into reserve status;

h) the incorporation and maintenance of the Holding Corporation; and

i) all reasonable costs associated with having New Acres purchased set apart as a reserve in accordance with the terms of the Settlement Agreement;

(v) “Minor Members” has the meaning described in Paragraph 17;

(w) “Member” means any person whose name appears on or is entitled to appear on the First Nation’s membership list maintained by the First Nation as its “band list” in accordance with section 10 of the Indian Act, under the terms of the XXXXXXXXXX First Nation Membership Law, as amended or replaced from time to time;

(x) “New Acres” means up to the XXXXXXXXXX acres of land, with or without subsurface rights, the First Nation has the right to purchase and have placed into reserve status in accordance with the Settlement Agreement;

(y) “Original Capital Use Date” means the date that the amount of the Compensation Balance is expended in accordance with the terms of the Trust Agreement;

(z) “Paragraph” refers to a numbered paragraph in this letter;

(aa) “Record Date” has the meaning described in Paragraph 17, which took place on XXXXXXXXXX;

(bb) “Referendum” means a referendum held in accordance with the same voting guidelines (XXXXXXXXXX of the Settlement Agreement) followed to ratify the Settlement Agreement and the Trust Agreement, or in the event the First Nation enacts the XXXXXXXXXX First Nation Constitution or law that provides for the conducting of referendums, then in accordance with the guidelines set out in the XXXXXXXXXX First Nation Constitution or such law, as amended or replaced from time to time;

(cc) “Remaining Annual Income” means the amount, if any, of the Annual Income in respect of the current Fiscal Year that remains after such Annual Income is reduced by amounts transferred during the current Fiscal Year under subsections XXXXXXXXXX of the Trust Agreement and, after the Original Capital Use Date, under subsection XXXXXXXXXX of the Trust Agreement;

(dd) “Reserve” means XXXXXXXXXX, a tract of land, the legal title to which is vested in Canada, which has been set aside by Canada for the use and benefit of the First Nation and includes any additional tracts of land which may be so vested and so set aside in the future;

(ee) “Settlement Agreement” means the XXXXXXXXXX;

(ff) “Subject Transactions” means the transactions described in Paragraphs 8 to 22;

(gg) “Taxation Year” has the meaning described in subsection 249(1);

(hh) “Trust” means XXXXXXXXXX Trust, established under the laws of the Province of XXXXXXXXXX by the First Nation pursuant to the terms of the Trust Agreement;

(ii) “Trust Account” means XXXXXXXXXX Trust Account established and maintained by the Trustee pursuant to the terms of the Trust Agreement;

(jj) “Trust Agreement” means XXXXXXXXXX Trust Agreement between the First Nation and the Trustee, dated XXXXXXXXXX;

(kk) “Trust Property” means all monies on deposit in the Trust Account, the Compensation Balance, the funds remaining in the Trust Account to make the initial per capita distribution to the Minor Members and all Authorized Investments in which the monies in the Trust Account may from time to time be invested, together with all accretions thereto and all income derived from such investments, but for greater certainty the Trust Property does not include monies that have been paid out of the Trust Account by the Trustee to, or on behalf of, the First Nation, any other payments made by the Trustee pursuant to the terms of the Trust Agreement, any New Acres purchased by the First Nation and any revenue earned on the New Acres;

(ll) “Trustee” has the meaning described in Paragraph 10;

(mm) “Trustee Services Agreement” has the meaning described in the Trust Agreement;

(nn) “Voter” means a Member of the First Nation who is eighteen (18) years of age or older and who is eligible to vote in the elections of the Council of the First Nation.

FACTS

A complete description of all the relevant facts is as follows:

1. The First Nation is a “band” as defined in subsection 2(1) of the Indian Act. The CRA’s position is that all bands within the meaning of the Indian Act meet the criteria to qualify for the income tax exemption provided under paragraph 149(1)(c).

2. The First Nation's postal address is:

XXXXXXXXXX.

3. The relevant tax services office is XXXXXXXXXX.

4. The Reserve is a “reserve” as defined in subsection 2(1) of the Indian Act.

5. There are approximately XXXXXXXXXX Members of the First Nation, with approximately XXXXXXXXXX Members residing on the Reserve.

6. The Council is the government of the First Nation. They exercise control over the administration and development of reserve lands, represent the Members in dealings with third parties including the federal and provincial governments, and have the power to make by-laws in accordance with the Indian Act. Council elections are held pursuant to the provisions of the XXXXXXXXXX Election Law. The term of office is XXXXXXXXXX years.

7. Following negotiations between the First Nation and Canada, the First Nation and Canada entered into the Settlement Agreement to settle the XXXXXXXXXX of the First Nation (XXXXXXXXXX).

SUBJECT TRANSACTIONS

8. The Settlement Agreement was ratified by the voting Members of the First Nation on XXXXXXXXXX, and subsequently signed by the Council on behalf of the First Nation on XXXXXXXXXX. The Settlement Agreement was signed by Canada on XXXXXXXXXX.

9. The First Nation established the Trust in order to receive and administer the Compensation Balance on behalf of the Beneficiary.

10. XXXXXXXXXX Trust is the Trustee of the Trust. XXXXXXXXXX Trust is a company which is authorized to carry on business as a trustee and Financial Institution in the Province of XXXXXXXXXX.

11. Pursuant to the Trust Agreement, the Trust becomes effective on the date of the first deposit of funds by the First Nation into the Trust Account (“Effective Date”).

12. Under the terms of the Settlement Agreement, the First Nation directed Canada to deposit the Compensation Balance into the Trust Account.

13. Canada deposited the Compensation Balance for and on behalf of the First Nation into the Trust Account on XXXXXXXXXX.

14. Pursuant to section XXXXXXXXXX of the Trust Agreement, all legal right, title and interest in and to the Trust Property will be vested in the Trustee and there will be no power of revocation, amendment or variation, except in accordance with the provisions of the Trust Agreement.

15. Pursuant to section XXXXXXXXXX of the Trust Agreement, all beneficial right, title, interest and benefit in and to the Trust Property will be vested in the Beneficiary.

16. Subject to the distributions to the First Nation described in Paragraph 17 and other terms and conditions of the Trust Agreement, pursuant to subsection XXXXXXXXXX and section XXXXXXXXXX of the Trust Agreement, the Trust Property will be invested by the Trustee in Authorized Investments.

17. Pursuant to the Trust Agreement, the Trust Property will be utilized in the first instance, for the following purposes:

(a) Pursuant to subsection XXXXXXXXXX of the Trust Agreement, for the payment of legal and advisory fees in the aggregate amount of $XXXXXXXXXX, on behalf of the First Nation;

(b) Pursuant to subsection XXXXXXXXXX of the Trust Agreement, for the transfer to the First Nation of up to $XXXXXXXXXX to pay the costs incurred by it in researching, preparing, negotiating and settling the XXXXXXXXXX and ratifying the Settlement Agreement and the Trust Agreement;

(c) Pursuant to subsections XXXXXXXXXX of the Trust Agreement, for the transfer to the First Nation of an amount (approximately $XXXXXXXXXX) for the purpose of an initial per capita distribution by the First Nation to the Members, the individual amount of which will be dependent on the age (in whole years) of each Member on the date of the resolution of the Council to pay the initial per capita distribution described in subsection XXXXXXXXXX of the Trust Agreement (“Record Date”). Specifically:

i. Each Member that is XXXXXXXXXX years of age on the Record Date will receive $XXXXXXXXXX (“Adult Member”).

ii. Each Adult Member who is over the age of XXXXXXXXXX, will receive the amount that an Adult Member will receive as determined above plus an amount which is equal to the age of the Adult Member on the Record Date minus XXXXXXXXXX. For example, an Adult Member that is XXXXXXXXXX years of age on the date of the resolution of the Council will receive $XXXXXXXXXX.

iii. Each Member that is less than XXXXXXXXXX years of age on the Record Date (“Minor Member”) will be paid his or her share of the initial per capita distribution by the First Nation after he or she attains the age of XXXXXXXXXX years or dies (using funds that will be retained by the Trust until that time). Each Minor Member that is XXXXXXXXXX years of age on the Record Date will receive $XXXXXXXXXX after he or she attains the age of XXXXXXXXXX years or dies. For every whole year of age less than XXXXXXXXXX years, the amount that a Minor Member will receive (subsequent to attaining the age of XXXXXXXXXX years) will be increased by $XXXXXXXXXX (such that, for example, a Minor Member that is XXXXXXXXXX years of age on the Record Date will receive $XXXXXXXXXX subsequent to that Member attaining the age of XXXXXXXXXX years).

iv. The amount to be paid to the Members in each age bracket will be reduced if it is determined by XXXXXXXXXX, and confirmed by the Council, that the make-up of the population of the First Nation would otherwise result in an initial per capita distribution of more than approximately $XXXXXXXXXX.

(d) Pursuant to section XXXXXXXXXX of the Trust Agreement, if any Member dies after the Record Date but before receiving his or her share of the initial per capita distribution, the amount of such distribution that the Member would have received (including the full amount that a Minor Member would have received upon attaining the age of XXXXXXXXXX years) shall be distributed to the beneficiaries of the deceased Member’s estate.

18. Pursuant to the Trust Agreement, the Trust Property will be subsequently utilized for the following purposes (in respect of which the Trust Agreement contains certain restrictions based upon specific financial formulas):

(a) Pursuant to subsection XXXXXXXXXX of the Trust Agreement, for the transfer of funds to the First Nation on an annual basis, commencing in the fourth Fiscal Year of the Trust as described in section XXXXXXXXXX of the Trust Agreement, in order for the First Nation to carry out further per capita distributions (in amounts to be determined) to Members that are XXXXXXXXXX years of age or older.

(b) Pursuant to subsection XXXXXXXXXX of the Trust Agreement, for the transfer of funds to the First Nation from time to time, to enable the First Nation to purchase New Acres and in order to pay Land Acquisition Costs.

(c) Pursuant to subsection XXXXXXXXXX of the Trust Agreement, for the transfer of funds to the First Nation from time to time in order for the First Nation to carry out XXXXXXXXXX Development projects.

(d) Pursuant to subsection XXXXXXXXXX of the Trust Agreement, for the transfer of funds to the First Nation from time to time in order for the First Nation to carry out XXXXXXXXXX Development projects.

(e) Pursuant to subsection XXXXXXXXXX of the Trust agreement, for the transfer of the Remaining Annual Income to the First Nation, annually.

(f) Pursuant to subsection XXXXXXXXXX of the Trust Agreement, for the payment of all Authorized Expenses.

19. Pursuant to section XXXXXXXXXX of the Trust Agreement, all transfers from the Trust to the First Nation for the purpose of purchasing New Acres and paying Land Acquisition Costs (subsection XXXXXXXXXX of the Trust Agreement), for the purpose of funding XXXXXXXXXX Development (subsection XXXXXXXXXX of the Trust Agreement), for the purpose of funding XXXXXXXXXX Development (subsection XXXXXXXXXX of the Trust Agreement) and, subsequent to the Original Capital Use Date, for the purpose of subsequent per capita distributions to Members (subsection XXXXXXXXXX of the Trust Agreement) are deemed to be made first from the Annual Income in respect of the current Fiscal Year of the Trust.

20. Pursuant to section XXXXXXXXXX of the Trust Agreement, transfers from the Trust to the First Nation for the purpose of the per capita distributions are considered to come from the Trust Property that is the Compensation Balance, until the date on which the Compensation Balance is fully expended (being the Original Capital Use Date).

21. Pursuant to XXXXXXXXXX of the Trust Agreement, Remaining Annual Income will be paid to, and used by, the First Nation in a particular Fiscal Year as follows:

a) On or before XXXXXXXXXX of each Fiscal Year of the Trust, the Trustee shall pay the Remaining Annual Income arising in that Fiscal Year to the First Nation (by way of the XXXXXXXXXX Account). The only exception is if, because of the nature of the Authorized Investments held by the Trust immediately prior to the end of the Fiscal Year, it is not possible or in the First Nation’s best interests to make the transfer of all or a portion of the Remaining Annual Income. In that case, the Trustee will issue an unrestricted demand promissory note to the First Nation for the amount of the shortfall. Payment of the promissory note will be made as soon as possible after the end of the Fiscal Year. Any amount represented by the promissory note shall be accepted by the First Nation as absolute payment for the amount outstanding.

b) Unless the First Nation is authorized otherwise by at least XXXXXXXXXX percent (XXXXXXXXXX%) plus XXXXXXXXXX of all eligible Voters voting in favour in a Referendum held to specifically consider the expenditure of the funds, as evidenced by a written resolution of the Council, on or before XXXXXXXXXX of the ensuing Fiscal Year, the Council shall, on behalf of the First Nation, ensure that all of the monies in the XXXXXXXXXX Account at that time are contributed to the Trust by way of deposit to the Trust Account, which contribution shall be made as soon as is reasonably possible after XXXXXXXXXX of each year.

22. Pursuant to section XXXXXXXXXX of the Trust Agreement, if the Trust is terminated in accordance with the relevant terms of the Trust Agreement, then upon such termination the Trust Property and all documents and records of the administration of the Trust shall revert to and be transferred to the First Nation to be used for the use and benefit of the First Nation as approved by a majority of the Voters who vote in a Referendum, provided that at least XXXXXXXXXX percent (XXXXXXXXXX%) plus XXXXXXXXXX of all eligible Voters vote in favour of the use of the funds in the Referendum.

ADDITIONAL INFORMATION

23. The First Nation is, and will continue to be throughout the existence of the Trust, the sole beneficiary of the Trust.

24. The First Nation holds all interests in the Trust, which have vested indefeasibly.

PURPOSE OF THE SUBJECT TRANSACTIONS

25. The purpose of the Subject Transactions is to achieve a final resolution of the Claims of the First Nation against Canada as set out in the Settlement Agreement and to ensure that funds are available for the future benefit of the First Nation. More specifically, the purpose is to establish the Trust to administer the Compensation Amount and to facilitate the objectives set out in the Trust Agreement.

RULINGS GIVEN

A. The initial per capita distributions as described in Paragraph 17(c) above, will not be income from a source to the Members within the meaning of paragraph 3(a) and will not be considered proceeds of disposition of property.

B. Any income or loss from the Compensation Balance received by the Trust as described in Paragraph 13 above, or from property substituted therefor, and any taxable capital gain or allowable capital loss from the disposition of the Compensation Balance, or property substituted therefor, shall be deemed to be income or a loss, as the case may be, or a taxable capital gain or allowable capital loss, as the case may be, of the First Nation, pursuant to subsection 75(2).

C. Any Annual Income of the Trust for a Taxation Year, excluding any income in respect of which subsection 75(2) applies, paid by the Trust to the First Nation during the Taxation Year under subsections XXXXXXXXXX of the Trust Agreement and, after the Original Capital Use Date, under subsection XXXXXXXXXX of the Trust Agreement will be considered to have become payable in the Taxation Year to the First Nation and may be deducted in computing the taxable income of the Trust for the Taxation Year pursuant to paragraph 104(6)(b). Income paid by the Trust to the First Nation pursuant to those subsections of the Trust Agreement during a Taxation Year will be considered to be sourced first from income in respect of which subsection 75(2) does not apply.

D. Subject to subsections 107(2.001), (2.002) and (4) to (5), where any property of the Trust is distributed by the Trust to the First Nation and there is a resulting disposition of all or any part of the First Nation’s capital interest in the Trust, the provisions of subsection 107(2) will apply.

These advance income tax rulings are subject to the limitations and qualifications set out in Information Circular IC 70-6R12 dated April 1, 2022. The above rulings are based on the law as it reads at the date of this letter and do not take into account any proposed amendments to the Act and the Regulations which, if enacted into law, could have an effect on the rulings provided herein.

OPINION

Provided that:

(i) there are no changes to the facts, Subject Transactions and Trust Agreement;
(ii) there are no relevant changes to paragraph (g) of the definition of “trust” in subsection 108(1); and

(iii) subparagraphs (g)(iii), (iv) and (vi) of the definition of “trust” in subsection 108(1) are not applicable to the Trust;

it is our opinion that subsection 104(4), as currently enacted, will not apply to the Trust by reason of the exclusion found in paragraph (g) of the definition of “trust” in subsection 108(1).

The above opinion should not be construed as an advance income tax ruling, nor is it binding on the CRA.

COMMENTS

Nothing in this letter should be construed as implying that the CRA has confirmed, reviewed, made any determination, or accepted any method for the determination in respect of:

(a) whether Remaining Annual Income will become payable in a Taxation Year;

(b) whether the further per capita distributions described in paragraph 18(a) will be taxable;

(c) any other tax consequences relating to the facts and Subject Transactions, or event taking place either prior to or subsequent to the Subject Transactions, whether described in this letter or not, other than those specifically described in the rulings given above.

An invoice for our fees in connection with this Ruling will be forwarded to you under separate cover.

Yours truly,

XXXXXXXXXX
for Division Director
Financial Industries and Trusts Division
Income Tax Rulings Directorate
Legislative Policy and Regulatory Affairs Branch