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This bulletin discusses how a taxpayer may account for cash or other non-share consideration received in lieu of a fractional interest in a share. ... No consideration other than shares of the corporation may be received for the convertible property. ... In lieu of the fractional shares, the agreement will usually provide for the taxpayer to receive cash or other non-share consideration. ...

The remainder of this bulletin is in two parts; 1) Part XIII Tax Considerations and 2) Part I Tax Considerations (payments considered business profits). ... PART XIII TAX CONSIDERATIONS 4. Refer to Information Circular 76-12R4 for applicable non-resident tax rates on amounts paid or credited to residents in treaty countries containing a specific article on management or administration fees or charges. ... In making such a determination consideration should primarily be given to the quantum or amount of the exclusion sought in relation to the service performed and the benefit derived by the payer. ...

The remainder of this bulletin is in two parts; 1) Part XIII Tax Considerations and 2) Part I Tax Considerations (payments considered business profits). ... PART XIII TAX CONSIDERATIONS 4. Refer to Information Circular 76-12R4 for applicable non-resident tax rates on amounts paid or credited to residents in treaty countries containing a specific article on management or administration fees or charges. ... In making such a determination consideration should primarily be given to the quantum or amount of the exclusion sought in relation to the service performed and the benefit derived by the payer. ...

Subsection 85(3) applies where a partnership has disposed of property to a corporation under subsection 85(2), winds up its affairs within 60 days of that disposition and has, immediately before the winding-up, no property other than money or property received from the corporation as consideration for the disposition. ... The consideration received by the partnership for one or more properties disposed of under subsection 85(2) must include at least one share of the capital stock of the corporation. ... For the purposes of paragraph 85(3)(c) the partnership must not own any property immediately before the winding up other than property received from the corporation as consideration for the disposition or money. ...

Subsection 85(3) applies where a partnership has disposed of property to a corporation under subsection 85(2), winds up its affairs within 60 days of that disposition and has, immediately before the winding-up, no property other than money or property received from the corporation as consideration for the disposition. ... The consideration received by the partnership for one or more properties disposed of under subsection 85(2) must include at least one share of the capital stock of the corporation. ... For the purposes of paragraph 85(3)(c) the partnership must not own any property immediately before the winding up other than property received from the corporation as consideration for the disposition or money. ...

Except where fair market value consideration is paid by the related minor, income earned on property transferred or loaned from a taxpayer to a related minor (and on property substituted therefor) is generally deemed to be income of the taxpayer and not of the related minor. ... An example of the operation of paragraph 74.3(1)(a) follows: An individual transfers, for no consideration, bonds which pay interest of $1,200 per annum to a family trust the beneficiaries of which are the individual's three children, two of whom are less than 18 years of age throughout the year. ... Pursuant to subsection 74.5(1), income or loss from transferred property does not attribute to the transferor where (a) the sale or other transfer is made for consideration equal to fair market value of the transferred property, and (b) the sale price or other consideration for the transfer is (i) fully paid by the transferee in cash or kind (and not from property furnished by the transferor), or (ii) satisfied in whole or in part by indebtedness in respect of which interest is charged at a rate not less than the lesser of the rate of interest prescribed for the purposes of subsection 161(1) and the rate that would be agreed upon between arm's length parties under similar circumstances at the time that the indebtedness is incurred, if all such interest is paid not later than 30 days after the end of the year in which it becomes payable. 17. ...

Except where fair market value consideration is paid by the related minor, income earned on property transferred or loaned from a taxpayer to a related minor (and on property substituted therefor) is generally deemed to be income of the taxpayer and not of the related minor. ... An example of the operation of paragraph 74.3(1)(a) follows: An individual transfers, for no consideration, bonds which pay interest of $1,200 per annum to a family trust the beneficiaries of which are the individual's three children, two of whom are less than 18 years of age throughout the year. ... Pursuant to subsection 74.5(1), income or loss from transferred property does not attribute to the transferor where (a) the sale or other transfer is made for consideration equal to fair market value of the transferred property, and (b) the sale price or other consideration for the transfer is (i) fully paid by the transferee in cash or kind (and not from property furnished by the transferor), or (ii) satisfied in whole or in part by indebtedness in respect of which interest is charged at a rate not less than the lesser of the rate of interest prescribed for the purposes of subsection 161(1) and the rate that would be agreed upon between arm's length parties under similar circumstances at the time that the indebtedness is incurred, if all such interest is paid not later than 30 days after the end of the year in which it becomes payable. 17. ...

A premium or other amount received by a landlord or tenant, as the case may be, as consideration for granting or extending a lease or sublease, permitting a sublease, or cancelling a lease or sublease is business income to the recipient if renting property forms part or all of a business being carried on. ... In cases where 1 to 3 above do not apply, a premium or other amount received by a landlord as consideration for (a) granting or extending a lease, or (b) permitting a sublease represents proceeds of disposition of rights which are capital property. ... All amounts received by a tenant as consideration for the disposition of part or all of a leasehold interest are considered to be proceeds of the disposition even where such amounts are calculated with reference to factors such as business losses resulting from relocation, moving costs, etc. ...

A premium or other amount received by a landlord or tenant, as the case may be, as consideration for granting or extending a lease or sublease, permitting a sublease, or cancelling a lease or sublease is business income to the recipient if renting property forms part or all of a business being carried on. ... In cases where 1 to 3 above do not apply, a premium or other amount received by a landlord as consideration for (a) granting or extending a lease, or (b) permitting a sublease represents proceeds of disposition of rights which are capital property. ... All amounts received by a tenant as consideration for the disposition of part or all of a leasehold interest are considered to be proceeds of the disposition even where such amounts are calculated with reference to factors such as business losses resulting from relocation, moving costs, etc. ...

Under subparagraph 40(2)(g)(ii), a taxpayer's capital loss on the disposition of a debt or other right to receive an amount is nil unless (a) the debt or right was acquired by the taxpayer for the purpose of gaining or producing income (other than exempt income) from a business or property, or (b) the debt or right was acquired by the taxpayer as consideration for the disposition of capital property to a person with whom the taxpayer was dealing at arm's length. ... (Where the debt in question is a loan bearing less than a reasonable rate of interest, refer to IT-239R2 "Deductibility of Capital Losses from Guaranteeing Loans for Inadequate Consideration and from Loaning Funds at less than a Reasonable Rate of Interest in Non-arm's Length Circumstances".) 3. ... The debt was not acquired by the taxpayer for the purpose of gaining or producing income or as consideration for the disposition of capital property to an arm's length person, so that subparagraph 40(2)(g)(ii) prevents a claim in respect of a $1,000 capital loss. ...