CRA notes that generally no terminal loss is available on the disposition of property of a class both to an affiliated and unaffiliated person

CRA was asked whether, in the situation where all the properties in a depreciable class were disposed of both to an affiliated and unaffiliated person, a terminal loss could be triggered by ordering the dispositions so that the dispositions to the unaffiliated person occurred second.

No! CRA indicated that even if the dispositions are so ordered, the notional depreciable properties which arise under s. 13(21.2)(e)(iii) based on an accrued terminal loss on the disposition of properties to the affiliated person, are deemed to be part of the same class as the properties which were disposed of to the unaffiliated person.  Accordingly, the requirement that there be no properties left in the class at the end of the year in order to claim a terminal loss, generally would not be satisfied.

Neal Armstrong.  Summaries of 11 March 2013 T.I. 2012-469231E5 F under ss. 13(21.2) and 13(21.1).