Search - consideration

In your letter you outline three hypothetical situations for our consideration. ... Therefore, if the Opco shares are exchanged after April 26, 1995 for Holdco shares as described in situation 1 above, the share exchange rule in paragraph 131(12) of the CIF will apply to grandfather any Holdco shares issued by each individual's Holdco as consideration for that individual's Opco shares. ... With respect to your second situation, if the Opco shares are grandfathered under paragraph 131(11)(b) of the CIF we agree that the shares of Holdco received by the shareholders as consideration for their Opco shares in a transaction where section 85 of the Act applies would continue to be grandfathered. ...

The 110(1)(d) deduction is available where no consideration is paid and shares are acquired with the in-the-money option increase in value since grant. ... Given this explanation. you asked us to confirm that the surrender of shares already owned by an employee to pay the exercise price of an option would not constitute a disposition for the purposes of the Act if no consideration other than new shares were received in return. ... In this respect, please be advised that this issue has recently been under review and as a consequence we are prepared to state that a deduction will be available where a SAR is exercised and shares are issued for no consideration. ...

As consideration for the property it acquired, B Ltd. assumes a mortgage of $200 000 and issues preferred shares of its capital stock with a redemption value of $800 000 to A Ltd. At the time of the sale, B Ltd. also agrees to assume an additional mortgage of $500 000 as consideration for the $500 000 demand note issued to it by A Ltd. ... In this situation, among others, our view is now that A Ltd. actually received consideration (other than any shares) of $700 000 when the property was transferred to B Ltd. ...

The transfer will be done on a pure rollover basis in the following manner: Holdco 1 transfers 50% of the shares of Opco to Newco on a rollover basis in consideration for shares of Newco. Opco transfers Business 2 assets to Newco in consideration for an assumption of $100 of liabilities of Opco by Newco and an issuance of $1,100 of shares of Newco to Opco. ... Opco transfers Business 2 assets to Newco in consideration for an assumption of $100 of liabilities of Opco by Newco and an issuance of $1,100 of shares of Newco to Opco. ...

The following examples illustrate several situations in which CRA may give favourable consideration. ... CRA will generally give favourable consideration to a request for waiver of the advantage tax in this situation. ... Upon learning of the share redemption later in 2012, the taxpayer takes immediate action and swaps the shares out of the RSRP for fair market value consideration. ...

If Opco repurchases 99.99% of the shares of the capital stock of Opco held by Holdco instead of paying a dividend, would paragraph 55(3)(a) apply with respect to the deemed dividend considering that the cash paid to Holdco in consideration of the repurchase is not supported by safe income and considering that the ACB of the shares repurchased is nominal? ... The CRA could find abusive a situation where cash is distributed to Holdco in consideration for the repurchase or redemption of shares of the capital stock of Opco (even if the cash was owned by Opco at the beginning of the series) if the cash does not come from income taxed in Opco. ... Question 2 Selon votre situation hypothétique, l’argent reçu par Gestion en considération de l’achat de gré à gré des actions du capital-actions d’Opco était détenu par Opco au début de la série mais ne provenait pas du revenu imposé dans les mains d’Opco (ne provenait donc pas du revenu protégé d’Opco). ...

The Queen (92 DTC 6320), whether or not the income from a trust that is payable by the trust is taxable in the hands of an Indian who is a beneficiary under the trust, requires consideration of all factors connecting a particular category of property (including a right to income from a trust) to a location on or off the reserve. All relevant factors should then be analyzed and weighted against three considerations which are: (i) the purpose of the exemption from taxation under the Indian Act (see below), (ii) the nature of the property (benefit) and (iii) the nature of the taxation of the property. ... A determination of the relevant connecting factors to which the greatest weight can be given in a particular case can only be made after consideration of all the circumstances. ...

Furthermore, the profitability of the "leasing" operation would be a consideration in this context. ... We are also adding that an additional consideration would be whether or not the general anti-avoidance provisions of section 245 of the Act could be applied. The consideration in relation to this provision is whether the amount in respect of the cost of the Vehicle could be recharacterized under paragraph 245(5)(c) of the Act. ...

Taking the foregoing into account, we are of the view that Xco receives consideration of $1,000,000 for the Land. ... (c) Is Yco entitled to deduct the entire "interest" component of the Mortgage payments if it assumes the Mortgage as partial consideration for the Land? ... the proceeds of disposition received by X co would be $850,000 which is comprised of the aggregate of the consideration received which includes the assumption of the mortgage having a principal amount of $400,000 and $450,000 cash.? ...

Deemed Dividend As discussed in paragraph 1 of Interpretation Bulletin IT-489R Non-Arm's Length Sale of Shares to a Corporation, section 84.1 of the Act contains rules concerning a non-arm's length disposition of shares to a corporation for consideration which generally includes shares of the corporation. ... Where the provisions of subsection 84.1(1) apply, there may be a reduction of the paid-up capital of the shares of the transferee corporation issued as consideration or the transferee corporation may be deemed to have paid a dividend to the transferor taxpayer. ... Nonetheless, the effect of the provisions of section 84.1 will not apply where the sum of the non-share consideration and the paid-up capital of the share consideration does not exceed the greater of: the paid-up capital of the transferred shares, and the transferor's "arm's length adjusted cost base" of the transferred shares. ...