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2015 Ruling 2014-0552871R3- Split-Up Butterfly-- summary under Paragraph 55(2.1)(b) Summary Under Tax Topics- Income Tax Act- Section 55- Subsection 55(2.1)- Paragraph 55(2.1)(b) post-butterfly sale of distributed shares by one TC to the other In connection with the butterfly split-up of DC equally between the family holding companies (Shareholder1 and Shareholder2) for two unrelated families, the shares of Subco2, which might be a significant subsidiary of DC, are split 50-50 between the two transferee corporations (TC1 and TC2) on the butterfly, then TC1 sells its shares of Subco2 to TC1 for FMV consideration. ...

2015 Ruling 2014-0552871R3- Split-Up Butterfly-- summary under Subsection 20(24) Summary Under Tax Topics- Income Tax Act- Section 20- Subsection 20(24) deferred revenue treated as boot In connection with the butterfly split-up of DC equally between the family holding companies for two unrelated families, the assumption of deferred revenue (presumably prepaid rent), on the distribution by DC of its property to the two transferee corporations, is treated as boot. ...

2002 Ruling 2002-016729A- Exploration/Sink Shaft-CEE-- summary under Paragraph (f) Summary Under Tax Topics- Income Tax Act- Section 66.1- Subsection 66.1(6)- Canadian exploration expense- Paragraph (f) Proposed exploration that was adjacent to what had been a mine would qualify as CEE (and the area if brought into production would qualify as a new mine for purposes of paragraph (g)) given that the connections between the new area and the old area (including a drift that provided fresh air ventilation) did not have substantial economic utility to the new area. ...

2007 Ruling 2007-0245281R3- windup of income trust on sale of assets:3rd party-- summary under Subsection 80(1) Summary Under Tax Topics- Income Tax Act- Section 80- Subsection 80(1) In connection with the winding-up of an income fund (the "Fund") after the acquisition of all its units, the Fund disposes of its assets (principally, limited partnership units) to the acquiring corporation ("Bidco") in consideration for a note of Bidco, and then distributes the note to Bidco in satisfaction of a capital distribution and capital gains distribution declared by the Fund so that the note is extinguished as a matter of law. ...

2007 Ruling 2007-0245281R3- windup of income trust on sale of assets:3rd party-- summary under Subsection 80(5) Summary Under Tax Topics- Income Tax Act- Section 80- Subsection 80(5) In connection with the winding-up of an income fund (the "Fund") after the acquisition of all its units, the Fund disposes of its assets (principally, limited partnership units) to the acquiring corporation ("Bidco") in consideration for a note of Bidco, and then distributes the note to Bidco in satisfaction of a capital distribution and capital gains distribution declared by the Fund so that the note is extinguished as a matter of law. ...

In connection with a takeover bid by Holdco for a public corporation in Country A, it uses the borrowed money to acquire (but not obtain a beneficial interest) in treasury shares of the taxpayer for the sole purpose of transferring such shares to the shareholders of Target as the consideration for acquiring their shares of the Target. ...

2015 Ruling 2015-0589471R3- Earnout-- summary under Subsection 85(1) Summary Under Tax Topics- Income Tax Act- Section 85- Subsection 85(1) s. 85(1) rollover available on dirty s. 85 exchange In connection with the implementation of an earnout transaction for the purchase of Holdco common shares by a key employee, the (corporate) shareholders of Holdco (a Canadian-controlled private corporation holding Opco) first transfer a portion of their Holdco common shares to Opco in consideration for tracking preferred shares of Opco (with Opco immediately selling the purchased common shares on a five-year earnout basis to the key employee). ...

In connection with a butterfly reorganization of DC, the addition of voting rights to such preferred shares in order that DC would be connected with TC for Part IV tax purposes would not result in the application of s. 245(2) given that DC would have been connected from the outset if the preferred shares originally issued had been voting. ...

2015 Ruling 2015-0564981R3- "cross-statute" amalgamation-- summary under Allowable Disposition Summary Under Tax Topics- Income Tax Act- Section 135.1- Subsection 135.1(1)- Allowable Disposition deemeed withdrawal from predecessor of Amalco under Plan of Arrangement Background ACo, which is a CCPC and an agricultural cooperative corporation that was incorporated under Act II, carries on both Business 1 and Business 2, each of which has a specified connection to its (farming) “ACo Members.” ... Purpose of transactions Business 2 has no connection to the xxx activities of the ACo members. ...

15 October 2004 Ruling RITS 52698-- summary under Paragraph 142(1)(c) Summary Under Tax Topics- Excise Tax Act- Section 142- Subsection 142(1)- Paragraph 142(1)(c) situs of supply where resort points seized In connection with rulings on the consequences of the seizure by creditors and resale by them of resort points, the Directorate noted that the portion of sold resort points that was considered to be supplied in Canada was determined by prorating the consideration payable by a recipient of resort points based on the extent to which the resort points represented a right to use real property situated in Canada. ...