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.
Please note that the following document, although believed to be
correct at the time of issue, may not represent the current
Position of the Department.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle du ministère.
Principal Issues:
In a situation where a trust owns properties consisting
of shares of two corporations controlled by an individual
throughout the relevant period, may the shares of each
corporation be counted in interpreting subparagraph
104(5.6)(c)(iii) of the Income Tax Act?
Position TAKEN:
Yes.
Reasons FOR POSITION TAKEN:
Subsection 33(2) of the Interpretation Act provides that
words in the singular include the plural and words in
the plural include the singular.
Alain Marchand
XXXXXXXXXX 5-940056
Attention: XXXXXXXXXX
April 15, 1994
Dear Sirs:
Re: Subparagraph 104(5.6)(c)(iii) of the Income Tax Act (the Act)
This is in reply to your letter dated December 29, 1993 concerning the interpretation of the words "shares of the capital
stock of a corporation" in clauses (A) and (B) of the above-mentioned subparagraph.
You would like to have confirmation that in a situation where a trust owns properties consisting of shares of two corporations controlled by an individual throughout the relevant period, the shares of each of the corporations may be counted in interpreting subparagraph 104(5.6)(c)(iii) of the Act.
As outlined in your letter, subsection 33(2) of the Interpretation Act provides that words in the singular include the plural and words in the plural include the singular.
Furthermore, subsection 3(1) of that Act provides that unless a contrary intention appears, its terms apply to every statute
enacted by the Parliament of Canada.
It is our opinion that the everyday use of the word "corporation" in subparagraph 104(5.6)(c)(iii) of the Act is interchangeable
with its plural, "corporations". As a result, we are of the opinion that if each corporation, whose shares are owned by a
trust, meets the criteria outlined in clauses (A) to (E), the shares of each corporation could be counted for purposes of subparagraph 104(5.6)(c)(iii) of the Act.
As stated in paragraph 21 of Information Circular 70-6R2 dated September 28, 1990, the above opinion does not constitute a ruling and accordingly, is not binding on Revenue Canada, Customs, Excise and Taxation.
Yours truly,
for Director
Manufacturing Industries,
Partnerships and Trusts Division
Rulings Directorate
Legislative and Intergovernmental
Affairs Branch
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