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Among other things, paragraph (n) of that definition (“Paragraph N”) excludes a cancellation of a share of the capital stock of a corporation (referred to in that paragraph as the “issuing corporation”) held by another corporation (referred to in that paragraph as the “disposing corporation”) if the cancellation occurs as part of a “foreign merger” (within the meaning assigned by subsection 87(8.1)) of two or more corporations (including the issuing corporation and the disposing corporation) to form one corporate entity (referred to in that paragraph as the “new corporation”), provided the disposing corporation receives no consideration for the share other than property that was, immediately before the merger, owned by the issuing corporation and that, on the merger, becomes property of the new corporation. ... In our view, while Paragraph N would apply to the cancellation of the shares of FA3 held by FA2, because FA2 would receive no consideration for the shares of FA3, Paragraph N would not apply to the cancellation of the shares of FA2. ... In these circumstances, it is our view that the property of FA3 would be received by FA1 as consideration for the shares of FA2. ...

Canco B transfers all the shares of Foreignco 2 that it owns to Foreignco 1 for the sole consideration of the shares of Foreignco 1. ... The pre-amble of subsection 85.1(3) of the Act states: "Where a taxpayer has disposed of capital property that was shares of the capital stock of a foreign affiliate of the taxpayer to any corporation that was, immediately following the disposition, a foreign affiliate of the taxpayer (in this subsection referred to as the "acquiring affiliate") for consideration including shares of the acquiring affiliate... ... Third, the consideration received by the taxpayer must include shares of the acquiring affiliate. ...

Generally, where a transfer of property is made by a corporation to its shareholders for no consideration or for consideration less than the fair market value, then a benefit equal to the difference between the fair market value of the property at the time of transfer and the consideration received would be included in the income of the shareholders, pursuant to subsection 15(1) of the Act. ...

The liability is equal to the lesser of the difference between the fair market value of the property transferred and the consideration given for the property, and the transferor's liability for the taxation year in which the property was transferred, or any preceding taxation year. ... The time when the assessment happens to take place is a consideration irrelevant to the statutory scheme. ... The spouse's liability would be the lesser of (a) the amount owing by the transferor, and (b) the difference between the fair market value of the property transferred and the consideration given for the property. ...

It is a question of fact as to whether or not an expenditure can be taken into consideration in the calculation of the apprenticeship expenditures of a taxpayer and in the calculation of its qualified scientific research and experimental development expenditures. However, when an expenditure can be taken into consideration as a qualified scientific research and experimental expenditure and also in the calculation of an apprenticeship expenditure, we are of the opinion that the taxpayer may take it into consideration twice for the purposes of computing his investment tax credit at the end of a taxation year. ...

These issues are currently under consideration by our Directorate and we anticipate having discussions with the Department of Finance before we respond to the technical interpretation requests. ... Specifically, we advised that: (1) the interpretation bulletin position was first adopted when a previous version of paragraph 256(7)(a) of the ITA provided a legal basis for the position; (2) a 1994 amendment to paragraph 256(7)(a) of the ITA had removed the legal basis for the position; (3) the bulletin position cannot therefore be extended to inter vivos trusts; and (4) consideration will have to be given to withdrawing the current bulletin position when the bulletin is next revised. ... The ITTN #34 statement that consideration will have to be given to withdrawing the current bulletin position when the bulletin is next revised means that the bulletin position may be relied upon until there is a formal retraction of paragraph 10 of IT-302R3 or a revised bulletin is published. ...

18 April 2006 External T.I. 2005-0149591E5- Right to Receive Income Unedited CRA Tags 54 248(1) Principal Issues: Does our interpretation in document A (see below), that the consideration from the sale of an interest in revenue generated from certain contracts was capital in nature, contradict our interpretations in documents B, C, and D (see below), that a right to receive income, in and by itself, would not be considered capital property. ... Specifically, it is your view that our interpretation in document A (see below), that the consideration from the sale of an interest in revenue generated from certain contracts was capital in nature contradicted our interpretations in documents B, C, and D (see below), that a right to receive income, in and by itself, would not be considered capital property. ... Our interpretation in document B above was that, based on the facts under consideration, the taxpayer's transfer to a corporation of a right to receive income, which arose under an employment contract, would qualify neither as capital property nor as eligible capital property under paragraphs 85(1.1)(a) and (e), respectively, of the Act. ...

You have also asked that consideration be given to taxing strike pay, to the extent that such pay exceeds dues paid by the worker. ... As such amendments are the responsibility of the Honourable Paul Martin, Minister of Finance, it was appropriate that you sent him a copy of your correspondence for consideration. I trust that the Department of Finance will give your recommendations due consideration. ...

Where an amount is paid up-front in respect of an investment in a timeshare, the tax consequences will depend on whether the payment is in consideration for leasing or for purchasing an interest in the real property. ... On the other hand, where the up-front payment is consideration for the purchase of an interest in the property, the cost of this property would be included in Class 1 and capital cost allowance could be deducted over time. Whether the up-front payment is consideration for a lease as opposed to a purchase of an interest in the property is a question that will have to be determined after a careful review of the documentation and circumstances surrounding the payment. ...

The definition of "flow-through share" in subsection 66(15) of the Act requires that a share be issued to a person by a principal-business corporation "under an agreement in writing (emphasis added) entered into... after February 1986, under which the corporation agrees for consideration that does not include property... a) to incur, in the period that begins on the day the agreement was made and ends 24 months after the end of the month that includes that day, Canadian exploration expenses or Canadian development expenses in an amount not less than the consideration for which the share is to be issued, and b) to renounce,... the Canadian exploration expenses or Canadian development expenses so incurred by it not exceeding the consideration received by the corporation for the share,... ...