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.
- 1992 Corporate Management Tax Conference TERM PREFERRED SHARES
Question 12
Will the Department, following the 1991 Tax Court of Canada decision in the Société d'Investissement Desjardins case [[1991] 1 C.T.C. 2214] (91 D.T.C. 393), take into consideration as one of the relevant factors in establishing whether particular term preferred shares were or were not acquired in the ordinary course of the business carried on by a corporation the fact that the corporation is a specified financial institution only by reason of being related to a financial institution and is not itself engaged in a financing business?
Department's Position
It is a question of fact whether or not term preferred shares have been acquired by a specified financial institution in the ordinary course of the business carried on by it. The factors described in response to question 62 of the 1984 Round Table continue to represent the factors to be considered in establishing whether shares were or were not acquired in the ordinary course of the business carried on by a specified financial institution. Whether or not the corporation is a specified financial institution only by virtue of being related to a financial institution is not relevant in this determination.
Author: M. Trotier June 11, 1992 Document Disclosed Pursuant to The Access To Information Act Document Divulgué en vertu de la loi sur l'accès à l'information
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