Translations of recent severed letters

Bundle Date Translated severed letter Summaries under Summary descriptor
2016-11-30 7 October 2016 APFF Roundtable Q. 6, 2016-0652821C6 F - Graduated Rate Estate - Total Charitable Gifts
7 October 2016 APFF Roundtable Q. 7, 2016-0652971C6 F - Paragraph 251(5)(b) and subsection 256(1.4) Income Tax Act - Section 256 - Subsection 256(1.4) - Paragraph 256(1.4)(a) does not include right to find a 3rd party purchaser for another’s shares
Income Tax Act - Section 251 - Subsection 251(5) - Paragraph 251(5)(b) - Subparagraph 251(5)(b)(ii) may include right arising after triggering of event over which no control
Income Tax Act - Section 251 - Subsection 251(5) - Paragraph 251(5)(b) - Subparagraph 251(5)(b)(i) right to find 3rd party purchaser
7 October 2016 APFF Roundtable Q. 9, 2016-0652921C6 F - Résidence - actif utilisé / Residence - asset used Income Tax Act - 101-110 - Section 110.6 - Subsection 110.6(1) - Qualified Small Business Corporation Share farm house must be more than 50% used by farm employees to qualify
Income Tax Act - 101-110 - Section 110.6 - Subsection 110.6(1) - Share of the Capital Stock of a Family Farm or Fishing Corporation primary employee use qualifies farm house
7 October 2016 APFF Roundtable Q. 10, 2016-0652931C6 F - Bien agricole admissible-saisine par succession Income Tax Act - 101-110 - Section 110.6 - Subsection 110.6(1.3) - Paragraph 110.6(1.3)(a) - Subparagraph 110.6(1.3)(a)(i) 3 owners if farm passes from father to estate to son
General Concepts - Ownership estate owns its property
7 October 2016 APFF Roundtable Q. 11, 2016-0652941C6 F - Contrat de location / Capital lease Income Tax Act - Section 248 - Subsection 248(1) - Small Business Corporation FMV of rights under a lease must be included
Income Tax Act - 101-110 - Section 110.6 - Subsection 110.6(1) - Qualified Small Business Corporation Share stipulated rights of lessee should be valued for QSBCS purposes
7 October 2016 APFF Roundtable Q. 12, 2016-0655911C6 F - Partial Leveraged Buy-Out and Monetization of ACB Income Tax Act - Section 84 - Subsection 84(2) amalgamation does not cause reorg etc. of business
7 October 2016 APFF Roundtable Q. 13, 2016-0652981C6 F - Allocation of the safe income on hand Income Tax Act - Section 55 - Subsection 55(2.1) - Paragraph 55(2.1)(c) business income earned by a corporation following a subscription for a separate class of discretionary dividend shares could be allocated to those shares
7 October 2016 APFF Roundtable Q. 14, 2016-0655921C6 F - Safe income on hand - Preferred shares Income Tax Act - Section 55 - Subsection 55(2.1) - Paragraph 55(2.1)(c) fixed dividends on full-ACB prefs did not come out of SIOH
Income Tax Act - Section 55 - Subsection 55(2.1) - Paragraph 55(2.1)(b) whether dividends paid on non-participating prefs engage s. 55(2) is a question of fact
7 October 2016 APFF Roundtable Q. 15, 2016-0652991C6 F - Application of subsection 55(2) - holding period Income Tax Act - Section 55 - Subsection 55(2.1) - Paragraph 55(2.1)(c) stock dividend of nominal value discretionary shares to shift value to an affiliate
7 October 2016 APFF Roundtable Q. 16, 2016-0653001C6 F - Safe income and freeze preferred shares Income Tax Act - Section 55 - Subsection 55(2.1) - Paragraph 55(2.1)(c) application of safe income on hand to dividends paid on estate freeze prefs
7 October 2016 APFF Roundtable Q. 17, 2016-0652781C6 F - Functional currency and acquisition of control Income Tax Act - Section 111 - Subsection 111(4) - Paragraph 111(4)(e) FX gains or losses on pre-transition debts not affected
Income Tax Act - Section 261 - Subsection 261(9) - Paragraph 261(9)(a) exclusion of pre-transition debts from s. 111(4)
Income Tax Act - Section 40 - Subsection 40(10) exclusion of pre-transition debts
7 October 2016 APFF Roundtable Q. 18, 2016-0652791C6 F - Taxable Canadian property and Part XIII tax Income Tax Act - Section 119 property must have been TCP continuously from the time of emigration
7 October 2016 APFF Roundtable Q. 19, 2016-0655841C6 F - Reimbursement of attributed income Income Tax Act - 101-110 - Section 103 - Subsection 103(1) no obligation to repay income reallocated to other partner
Income Tax Act - Section 74.1 - Subsection 74.1(1) no domestic secondary adjustment doctrine
Income Tax Act - Section 69 - Subsection 69(1) - Paragraph 69(1)(b) excess disposition proceeds not required to be repaid
7 October 2016 APFF Roundtable Q. 20, 2016-0655831C6 F - Employee Buycos and the Poulin Case Income Tax Act - Section 251 - Subsection 251(1) - Paragraph 251(1)(c) Poulin distinction between accommodation parties and tax advantaged arm’s length dealings accepted
Income Tax Act - Section 84.1 - Subsection 84.1(1) Poulin accepted
7 October 2016 APFF Roundtable Q. 21, 2016-0655901C6 F - Section 7 and bonus paid in share Income Tax Act - Section 7 - Subsection 7(3) - Paragraph 7(3)(a) s. 7 can govern bonuses paid in shares where discretion ceases prior to the issuance
Income Tax Act - Section 84 - Subsection 84(1) - Paragraph 84(1)(b) PUC of shares issued in satisfaction of bonus equal to bonus amount
Income Tax Act - Section 7 - Subsection 7(1.1) 7(1.1) applicable to non-discretionary bonus payable in shares
7 October 2016 APFF Financial Strategies and Instruments Roundtable Q. 1, 2016-0651771C6 F - Critical Illness Insurance Income Tax Act - Section 15 - Subsection 15(1) benefit on gratuitous transfer of critical illness policy by corporation to its shareholder
7 October 2016 APFF Financial Strategies and Instruments Roundtable Q. 2, 2016-0651711C6 F - RRIF, Transfer of designated benefit Income Tax Act - Section 146.3 - Subsection 146.3(6.11) computation of eligible amount following year of death
7 October 2016 APFF Financial Strategies and Instruments Roundtable Q. 3, 2016-0651761C6 F - Transfer of a Life Insurance Policy Income Tax Act - Section 148 - Subsection 148(7) - Paragraph 148(7)(a) s. 148(7)(a) prevails over s. 69(1)(b) and 52(2), but not s. 69(5)
7 October 2016 APFF Financial Strategies and Instruments Roundtable Q. 4, 2016-0651791C6 F - Choix 45(2) et (3) - immeuble à logements Income Tax Act - Section 45 - Subsection 45(3) invalidity of s. 45(3) elections on duplex units applied only for changes of use after February 21, 2012
Income Tax Act - Section 54 - Personal-Use Property land underlying duplex used 40% personally is not personal-use property
Income Tax Regulations - Regulation 1102 - Regulation 1102(2) Reg. 1102(2) deems building to be separate from land and does not bifurcate the land
Income Tax Act - Section 40 - Subsection 40(2) - Paragraph 40(2)(g) - Subparagraph 40(2)(g)(iii) capital loss recognition on land underlying duplex used 40% personally
7 October 2016 APFF Financial Strategies and Instruments Roundtable Q. 5, 2016-0651721C6 F - Application of subsections 146(16) and 73(1) after death Income Tax Act - Section 146 - Subsection 146(16) no tax deferred transfer if by estate
Income Tax Act - Section 73 - Subsection 73(1.01) - Paragraph 73(1.01)(b) no rollover if transferor spouse dies before transfer pursuant to separation agreement made
7 October 2016 APFF Financial Strategies and Instruments Roundtable Q. 6, 2016-0651741C6 F - Named beneficiary Income Tax Act - Section 122 - Subsection 122(3) - qualified disability trust - Paragraph (b) beneficiary must be specifically named
7 October 2016 APFF Financial Strategies and Instruments Roundtable Q. 7, 2016-0651751C6 F - Recovery Tax of Qualified Disability Trust Income Tax Act - Section 122 - Subsection 122(2) recovery tax applies to undistributed income in a QDT at the time of the disabled beneficiary’s death
Income Tax Act - Section 159 - Subsection 159(2) potential liability of QDT trustee for s. 122(1)(c) recovery tax

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