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: Minor amendment to proposed transaction
Position: No effect on rulings
Reasons: n/a
XXXXXXXXXX
XXXXXXXXXX 982335
XXXXXXXXXX
Attention: XXXXXXXXXX
XXXXXXXXXX, 1998
Dear Sir:
Re: XXXXXXXXXX - Advance income tax ruling (our reference 980299)
(the “Ruling”)
This is in reply to your letter of XXXXXXXXXX, wherein you have advised us of an amendment to the statements of proposed transactions contained in the Ruling. All capitalized terms have the meaning assigned in the Ruling.
On the incorporation of Transferee, described in paragraph 29 of the Ruling, nominal incorporating shares were issued to Shareholder 4.
Accordingly, it is proposed to delete paragraph 36 of the Ruling and replace it with the following:
“36. Shareholder 4 will transfer to Transferee all of his XXXXXXXXXX Common Shares of Distributor is exchange for XXXXXXXXXX Transferee Common Shares of Transferee having a fair market value approximately equal to the fair market value of the Common Shares of Distributor so transferred. The aggregate addition to the stated capital of Transferee in respect of all of the common shares it issues to Shareholder 4 will be $XXXXXXXXXX. No non-share consideration will be paid.”
Ruling B will be deleted and will be replaced with the following:
“B. Section 84.1 will apply to the sale of the XXXXXXXXXX Distributor Common Shares to Transferee referred to in paragraph 36 as amended above such that the PUC of the Transferee Common Shares issued as the consideration for the sale by Shareholder 4 of the XXXXXXXXXX Distributor Common Shares will be equal to the PUC of the XXXXXXXXXX Distributor Common Shares to Shareholder 4 immediately before that sale. No dividend will be deemed to arise under paragraph 84.1(1)(b).”
We confirm that the rulings given in the Ruling as amended above will not be affected as a result of the amendment outlined above.
Yours truly,
for Director
Reorganizations and International Division
Income Tax Rulings and
Interpretations Directorate
Policy and Legislation Branch
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