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.
Dear Sirs:
This is in reply to your letter of November 21, 1986.
The answer to your second and third questions may be found in the last sentence of paragraph 1 of Interpretation Bulletin IT-291R and in the third sentence of paragraph 17 of Information Circular 76-19R.
In answer to your first question, it is our opinion that the requirement in the preamble of subsection 85(1) of the Income Tax Act that the consideration for property transferred to a taxable Canadian corporation must include shares of the capital stock of the corporation would not be satisfied by a consideration that is a right to receive any such shares. (See also the first, third and fifth sentences of paragraph 17 of Information Circular 76-19R).
We trust that the above answers your queries.
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© Her Majesty the Queen in Right of Canada, 1987
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© Sa Majesté la Reine du Chef du Canada, 1987
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