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Réponse du ministère du Revenu Dans cette affaire, la Cour suprême a mentionné dans son «Sommaire des principes et conclusion quant au contrôle», que dans la détermination du «contrôle effectif» d’une société, il faut prendre en considération la loi sur les sociétés par laquelle est régie la société, le registre des actionnaires, et toute limitation spécifique imposée soit au pouvoir de l’actionnaire majoritaire de contrôler l’élection des membres du conseil d’administration, ou soit au pouvoir du conseil d’administration de gérer les affaires tant commerciales qu’internes de la société. ... La Cour suprême a aussi mentionné que les documents autres que le registre des actionnaires, les actes constitutifs et les conventions unanimes des actionnaires, ne doivent généralement pas être pris en considération pour les fins de la détermination du «contrôle effectif» sur les affaires et les destinées de la société. ... Entre autres, le Ministère continuera de prendre en considération l’incidence des conventions unanimes des actionnaires dans la détermination du contrôle de droit. ...

Principal Issues: Surrenders for no consideration of an income interest in a pre-1972 spousal trust and the application of subsections 106(2) and 107(4) of the Act. ... XXXXXXXXXX 5-940219 Attention: XXXXXXXXXX April 18, 1994 Dear Sirs: Re: Subsections 106(2) and 107(2) of the Income Tax Act ("the Act") This is in reply to your letter dated January 21, 1994 wherein you requested an interpretation regarding the application of the above mentioned subsections of the Act where a spouse renounces or releases his/her income interest in a pre-1972 spousal trust for no consideration and where he/she does not direct the manner in which the income interest is to be distributed. ... We concur your views that according to paragraph 9 of Interpretation Bulletin IT-385R2, where a taxpayer for no consideration validly surrenders his/her income interest in a trust and does not direct the manner in which the income interest is to be distributed, he/she will not be considered to have received any proceeds of disposition for the purposes of subsection 106(2) of the Act. ...

Reasons FOR POSITION TAKEN: The person is receiving consideration for providing services. ... These paragraphs respectively includes the following comments: "Amounts received as gifts, that is, voluntary transfers of real or personal property without consideration, are not subject to tax in the hands of the recipient. However, when by virtue of an office or employment a voluntary payment or other valuable transfer or benefit is received by an employee from an employer, or from some other person the amount of the payment or other valuable consideration is generally included in income pursuant to subsection 5(1) or paragraph 6(1)(a).... ...

On April 1 USco acquires from Canco a $1,000,000 Government of Canada 90 day T-bill due on June 30 for fair market value consideration of $990,000. On April 20 USco sells the T-bill back to Canco for fair market value consideration of $993,500. ... Consideration would be given to, among other things, the definition of "investment business" in subsection 95(1) and the provisions of paragraphs 95(2)(a.1), 95(2)(a.3) and 95(2)(l) and subsections 95(2.3) and 95(2.4). ...

Principal Issues: How a loan from a corporate partner to its partnership should be taken into consideration in determining whether the shares of the corporate partner qualify as QSBCS. ... Your concern focused on how a loan from a corporate partner to its partnership would be taken into consideration in determining whether the shares of the corporate partner qualify as QSBCSs to its shareholder. ... These comments are general in nature and do not specifically take into consideration the facts in the hypothetical situation which you outlined. ...

If the decrease in the adjusted cost base of the partnership interest is a result of losses of the partnership, the amount of borrowed money used to acquire the consideration, for purposes of subsection 20.1(1) of the Act, will be based on the fair market value of the property received in satisfaction of the partnership interest and the original cost of the partnership interest. Generally, the amount of borrowed money to which subsection 20.1(1) of the Act applies is the total amount of borrowed money outstanding just before it ceases to be used to earn income from the property minus the amount of borrowed money that is not considered to have been lost determined as follows:-money that is traceable to an ineligible use such as a drawdown of capital-where the property has been disposed of for an amount of consideration at least equal to the fair market value of the property, the amount of the borrowed money that, under the existing rules, is traceable to the consideration, and-otherwise, the amount of the borrowed money that would, under existing rules, be traceable to the money received by the taxpayer if the taxpayer had disposed of the property for an amount of money equal to the fair market value of the property. ...

At question 33 of the 1987 Revenue Canada Round Table, in Report of Proceedings of the Thirty-Ninth Tax Conference, 1987 Conference Report (Toronto: Canadian Tax Foundation, 1988), the Department's position on what factors would be considered in determining the amount of a benefit when a corporation's property is made available to a shareholder was stated as follows: "When a corporate property, for which there is a commercial rental market, is made available to a shareholder, the Department usually considers that the benefit is equal to the fair market rental for the property less any consideration paid. ... In such cases, the amount or value of the benefit will usually be determined by the Department taking into account a normal rate of return on the greater of the cost or fair market value of the property, plus the related operating costs (the "imputed amount"), less any consideration paid to the corporation by the shareholder. ... However, the Department also stated that in cases where the circumstances are the same as those in the Youngman case, the Department accepts that in determining the amount of the benefit, the shareholder's interest-free loan to a corporation to enable it to purchase the property should be taken into consideration. ...

PharmcoA purchased 100% of PharmcoB for consideration consisting of loans from the vendor and from another party. ... In a situation such as the one you have described, where a transfer of property is made by a corporation to its shareholders for no consideration, then the value of such property would be included in the income of the shareholders pursuant to subsection 15(1) of the Income Tax Act (the "Act"). ... We have enclosed Interpretation Bulletin IT-405, Inadequate Considerations- Acquisitions and Dispositions, for additional information on such transactions. ...

At question 33 of the 1987 Revenue Canada Round Table, in Report of Proceedings of the Thirty-Ninth Tax Conference, 1987 Conference Report(Toronto: Canadian Tax Foundation, 1988), the Department's position on what factors would be considered in determining the amount of a benefit when a corporation property is made available to a shareholder was stated as follows: "When a corporate property, for which there is a commercial rental market, is made available to a shareholder, the department usually considers that the benefit is equal to the fair market rental for the property less any consideration paid. ... In such cases, the amount or value of the benefit will usually be determined by the department taking into account a normal rate of return on the greater of the cost or fair market value of the property, plus the related operating costs (the "imputed amount"), less any consideration paid to the corporation by the shareholder. ... However, the Department also stated that in cases where the circumstances are the same as those in the Youngman case, the Department accepts that in determining the amount of the benefit, the shareholder's interest-free loan to a corporation to enable it to purchase the property should be taken into consideration. ...

Reasons: The discount rate must take the risk element inherent in investments into consideration. 5-960388 XXXXXXXXXX C. ... The general approach is to value the various interests taking into consideration the fair market value of the property itself, the current interest rates, the life expectancy of any life tenants, and any other factors relevant to the specific case. ... In our view, the prescribed interest rate would not be an appropriate discount rate in all cases, since it does not take the risk element inherent in certain investments into consideration. ...