Search - consideration

Paragraph 110.6(14)(f) provides that shares issued after June 13, 1988 by a corporation to a taxpayer shall be deemed to be owned immediately before their issue by a person who was not related to the taxpayer unless the shares were issued as consideration for other shares or as part of a transaction or series of transactions involving certain dispositions of property to the corporation. ... Will Revenue Canada comment on whether the "new" shares should be regarded as having been issued as consideration for the "old" shares and, as a result, will not be considered to have been owned by a person not related to the individual taxpayer? Department's Position It is our view that, if shares are considered as a matter of the relevant corporate law to be issued when shares are "changed" in the manner described above, the "new" shares are issued as consideration for other shares for purposes of subparagraph 110.6(14)(f)(i) of the Act. ...

Also, the proposed transactions described in your request involve your company, which is incorporated under the laws of Ontario, issuing shares for consideration consisting of a promissory note.  As discussed, subsection 23(3) of the Business Corporations Act (Ontario) (the "OBCA") provides that a share of a company which is governed by the OBCA can not be issued until the consideration for the share is fully paid and, pursuant to subsection 23(6) of the OBCA, a promissory note or other indebtedness is not acceptable consideration for the issue of a share.  ...

Laurikainen (613) 957-2125 SUBJECT: Application of Subsection 69(3) of the Income Tax Act (the "Act") Further to our telephone conversation of June 16, 1988, the Montreal D.O. has requested our views on whether a loan guarantee made by a Canadian Company on behalf of its wholly-owned U.S. subsidiary for no consideration would be subject to the provisions of subsection 69(3) of the Act. ... Since it is common for a parent company to guarantee the loans of a subsidiary for no consideration, this subsection could have wide spread application. ... We have attached a copy of the correspondence received from XXXX of XXXX for your consideration. for Director Reorganizations and Non-Resident Division Specialty Rulings Directorate Legislative and Intergovernmental Affairs Branch ...

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. ...

There were no agreements, nor were any contemplated between the guarantor and the corporation respecting any consideration in exchange for the guarantee. ... The Department's position as stated in paragraph 3 of IT-239R2 is that a capital loss arising from honouring a guarantee given for inadequate or for no consideration is nil by virtue of subparagraph 40(2)(g)(ii) of the Act. ... The subsequent carrying charges respecting borrowed funds to discharge the loan would also not be deductible as the guarantor did not receive any consideration for the guarantee and therefore the expenditures would not be considered to be for the purpose of producing income. ...

Mitchell 957-2139 RE Employee Stock Appreciation Rights Paragraph 110(1)(d) Further to our memorandum of March 13, 1986, concerning the issue of stock appreciation rights ("SAR's") and paragraph 110(1)(d) of the Act, we wish to draw to your attention a further consideration in this context. ... Our resolution of that issue will be influenced by the underlying consideration of whether, if such a benefit does fall within subsection 7(1), the deduction provided for in paragraph 110(l)(d) would or should be available to an employee who simply receives cash payment directly pursuant to the terms of an agreement with his employer. ... We would draw to your attention that in the case of Greiner 84 DTC 6073, the Federal Court of Appeal held that a cash payment received in consideration for the surrender of stock option rights was taxable pursuant to paragraph 7(1)(b). ...

You have suggested that in this scenario, the additional contributions of capital by the beneficiaries should not disqualify Trust as a personal trust on the basis that the contribution would not constitute consideration payable for a beneficial interest in the trust, and have asked that the Canada Revenue Agency ("CRA") confirm your view. ... In technical interpretation 9432135, which addressed beneficial interests in an employee profit sharing plan ("EPSP"), CRA stated its position that "the sole fact that an employee is a beneficiary under an EPSP due to his employment does not constitute consideration payable to the employer to acquire a beneficial interest in the said EPSP". ... Our response also further noted that "whether a beneficial interest was acquired for consideration payable to the trust or to any person who has made a contribution to the trust is a question of fact". ...

Principal Issues: Where FAPI arises as a result of a disposition by a foreign affiliate but foreign tax in respect of that disposition is deferred a result of a roll-over under foreign law, may foreign tax arising as a result of a gain on the disposition of the consideration received by the foreign affiliate on the original transaction qualify as foreign accrual tax? ... Such FAPI is included in the income of Canco under subsection 91(1) of the Act. 5) In the immediately following taxation year, the Partnership disposes of the Consideration Property for proceeds of disposition equal to its fair market value and this value is equal to its adjusted cost base for the purposes of the Act. ... However, it would be necessary to review all the relevant details that would be available in an actual case in order to make a definitive determination whether the gain on the Consideration Property could be entirely attributed to the income deferred on the original disposition. ...

Position: The proceeds of the disposition to the transferor and the ACB to the transferee would be the greatest of the cash surrender value, the consideration given for the interest and the ACB of the interest in the policy. ... For this purpose, paragraph 148(7)(a) would apply to deem the proceeds of the disposition to Opco to equal $50,000 (the greatest of CSV ($500), consideration (nil) and ACB ($50,000)), resulting in a policy gain of nil. ... We have brought this situation to the attention of the Department of Finance for their consideration. ...

23 March 2007 External T.I. 2007-0227981E5- Canadian Resource Property Unedited CRA Tags 66(15) 66.4(5) 66.2(5) 59(3.2)(c) Principal Issues: tax treatment for consideration received on entering into a petroleum and natural gas lease Position: consideration represents proceeds to be credited to the CCOGPE pool Reasons: review of the legislation 2007-022798 XXXXXXXXXX T. Harris (613) 957-2114 March 23, 2007 Dear XXXXXXXXXX: Re: Petroleum and Natural Gas Lease We are writing in response to your recent request for our interpretation of the tax treatment for certain payments received as consideration for entering into a petroleum and natural gas lease (the "PNG Lease"). ... In 2006, XXXXXXXXXX leased these rights to an arm's length party for a term of XXXXXXXXXX years for consideration consisting of a lump sum rental payment, a bonus payment and a signing payment (the "Payments"). ...