Search - consideration

Reasons FOR POSITION TAKEN: Unlikely that the donation would be voluntary and the donation would not be without consideration, since it would not be entirely separate from and unrelated to the purchase of XXXXXXXXXX 5-942227 XXXXXXXXXX C.Chouinard Attention: XXXXXXXXXX September 13, 1994 Dear Sir: Re: Gifts to the XXXXXXXXXX We are writing in reply to your letter of August 30, 1994, wherein you requested our comments on the tax status of donations to the XXXXXXXXXX XXXXXXXXXX Our Comments As indicated in paragraph 3 of Interpretation Bulletin IT-110R2 (a copy of which is enclosed), a gift is a voluntary transfer of property without valuable consideration. A gift can be said to have been made where all of the following conditions are satisfied: (a)property (usually cash) is transferred by a donor to a municipality; (b)the transfer is voluntary; and (c)no consideration or benefit accrues to the donor or to anyone designated by the donor as a result of the transfer. ...

As indicated in paragraph 3 of Interpretation Bulletin IT-110R2 (a copy of which is enclosed), a gift is a voluntary transfer of property without valuable consideration. A gift can be said to have been made where all of the following conditions are satisfied: (a)property (usually cash) is transferred by a donor to a registered charity; (b)the transfer is voluntary; and (c)no consideration or benefit accrues to the donor or to anyone designated by the donor as a result of the transfer. ... The first condition is not met as the purported donation is made to retailers of kosher-approved food products which are not registered as charities; the second condition is not met as the purported cash donation is part of the cost of the food products and is not made voluntarily; and the third condition is not met as the purported donation is not without consideration since you receive food products in exchange for your donation. ...

We would particularly draw your attention to the third precondition, the transfer must occur without consideration or benefit accruing to the donor or to anyone designated by the donor. ... It is our view that there is a reasonable argument that the assumption of a mortgage by a recipient would constitute "consideration", being a benefit to the donor to the extent that he is relieved of responsibility for the debt. ... It is our view that the purchase of a Joint and Survivor Life Insurance Policy would not change the fact that the assumption of the mortgage referred to above did constitute "consideration" to the donor. ...

Principal Issues: Where a taxpayer disposes of or exchanges securities in circumstances in which the rollover provisions of subsection 7(1.5) are otherwise meant to apply, will the receipt of non-share, non-cash consideration by the taxpayer deny the application of subsection 7(1.5)? ... Kauppinen April 1, 2003 Dear XXXXXXXXXX: Re: Subsection 7(1.5) of the Income Tax Act ("Act") This is in reply to your letter dated February 12, 2003 regarding the application of subsection 7(1.5) of the Act in situations where non-share, non-cash consideration is received for the disposition of the "exchanged securities" (as defined in subsection 7(1.5) of the Act). ... Paragraph 7(1.5)(b) of the Act clearly states that the taxpayer must receive no consideration for the disposition or exchange of the exchanged securities other than "new securities"(as defined in paragraph 7(1.5)). ...

Bob Naufal, CMA XXXXXXXXXX (613) 957-2744 2004-005647 February 23, 2004 Dear XXXXXXXXXX: Re: Farm inventory and partnership wind up We are writing in response to your email of January 12, 2004, in which you asked for our comments on the situation where inventory is transferred from a cash basis farm partnership to a Canadian-controlled private corporation ("CCPC") for consideration of an open note and shares of the CCPC. ... Subsection 85(2) of the Act provides that the rules under subsection 85(1) of the Act apply where the property in question is owned by a partnership and is transferred to a taxable Canadian corporation for consideration that includes shares of the corporation. ... In the situation described in your email, it is our view that the open note received as part of the consideration on the disposition of the farm inventory will not, in and of itself, invalidate the application of subsection 85(3) to the partnership wind-up, provided that all other requirements of that provision are met. ...

Also, the statement in "(d) the price of timber is fixed; and" should be replaced by "(c) the total contract price for the timber sold is fixed, for example, the contract for sale of timber specifies the consideration computed by reference to the timber actually removed within a specified time or from a specified area; and". ... Reasons: This is to clarify our interpretations and to take into consideration the impact of the recent court decisions of the cases of Jens Larsen and Desrosiers. 2000-003934 XXXXXXXXXX Peter Lee (613) 957-8977 Attention: XXXXXXXXXX October 12, 2000 Dear Sirs: Re: Timber Sales This is in reply to your facsimile of July 26, 2000 wherein you requested confirmation that the comments in our letter of January 26, 2000 (our file number 992848) are still applicable. ...

Roy, CGA Attention: XXXXXXXXXX March 10, 1999 Dear Sirs: Re: Application of Price Adjustment Clauses This is in reply to your letter of November 5, 1998 wherein you requested a technical interpretation with respect to the application of a price adjustment clause in the context of the issuance of common shares as consideration for the settlement of a debt where the parties were not dealing at arm’s length. ... Where a corporation issues shares to a person as a consideration for the settlement of a debt issued by the corporation and payable to the person, paragraph 80(2)(g) of the Income Tax Act provides that the amount paid is the fair market value of the shares issued by the corporation. Consequently, pursuant to section 80 of the Income Tax Act, there will not be a forgiven amount where the fair market value of the shares issued and other consideration is equal to the amount of the debt repaid. ...

There remained consideration for remission of taxes under the Financial Administration Act. ... Consideration of requests of this nature involves an extensive and fully objective review of the facts of the particular situation and a careful evaluation of the merits of the request to ensure fair and uniform application of established criteria. ... I can assure you that he will receive the utmost consideration possible in the resolution of his case. ...

La considération convenue est un pourcentage des honoraires que l'acheteur percevra de la clientèle ainsi acquise pendant une période de cinq ans. 4.     Une considération maximale est fixée. 5.     Aucun montant minimal n'est prévu. ... De plus, si ce doit être l'article 14, vous nous demandez de préciser de quelle manière cet article sera appliqué compte tenu qu'au moment de la vente la considération à recevoir par le vendeur n'est pas connue. ...

The agreements between the parties reflecting this arrangement would be examined in order to determine whether, in fact, there is no consideration received from A Co for the use of these vehicles.  Even though there may be no cash payment from A Co, there may be equivalent consideration in the form of advertising or promotional service provided by A Co in exchange for the use of the demonstrator cars.  ... On the assumption that the value of the consideration for the use of the cars supplied by the manufacturer is the annual cost of leasing a similar vehicles by A Co, that value would be considered as "amounts that may be reasonably regarded as having been payable by the employer to a lessor... ...