Proposed s. 104(13.3) undercuts use of Alberta trusts to shift income to Alberta

Proposed s. 104(13.3) establishes that ss. 104(13.1) and (13.2) designations, to effectively retain income in a trust, can only be used after 2015 to the extent that the trust taxable income otherwise would be nil (through loss utilization). This undercuts the use of an Alberta trust to have income "inside" the trust taxed at a lower rate than if it were taxed in the hands of its beneficiaries resident in a higher rate jurisdiction.

Neal Armstrong.  Summary of Gary I. Biasini, "The Trust is Dead, Long Live The Trust," Tax Topics (Wolters Kluwer CCH), Number 2227, November 13, 2014, p. 1 under s. 104(13.3).