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2018 Ruling 2018-0780201R3- Post-mortem pipeline-- summary under Subsection 84(1) Summary Under Tax Topics- Income Tax Act- Section 84- Subsection 84(1) use of CDA and s. 84(1) deemed dividend to generate s. 164(6) loss CRA provided rulings for a pipeline transaction in which the estate with a resident beneficiary sells a company (Opco) with apparently a real estate business to a Newco for consideration consisting mostly of a note, followed by an amalgamation of the two companies and the repayment by Amalco to the estate of the note over time. ...

IV tax circularity avoided through winding-up dividend in subsequent year A butterfly split-up of a DC holding rental property between two transferee corporations (the TCs) for two unrelated families, with undivided interests in the real estate being transferred to each TC in consideration for the assumption of liabilities (in such proportions as to ensure satisfaction of the pro rata distribution requirement) and for voting preferred shares (presumably with somewhat less than 50% of the votes of each TC), which were promptly redeemed for notes. ...

2020 Ruling 2020-0860231R3- Post-mortem planning-- summary under Paragraph 88(1)(d.3) Summary Under Tax Topics- Income Tax Act- Section 88- Subsection 88(1)- Paragraph 88(1)(d.3) bump applied to amalgamation occurring in a pipeline transaction CRA ruled on pipeline transactions respecting common shares of Opco which the deceased held on death, in which: the estate transfers its common shares of Opco to the Newco newly-incorporated by it mostly in consideration for a demand note of Newco at least 12 months thereafter, Opco amalgamated with Newco. in connection with the amalgamation, Amalco designates, in its return of income for its first taxation year, an amount under ss. 87(11) and 88(1)(c) and (d) to bump the ACB of land that had been held (as capital property) continuously by Opco from before the date of the death until immediately prior to the amalgamation. the Newco note is gradually repaid over a period of at least one year after the amalgamation, with Amalco continuing to carry on the business. ...

2017 Ruling 2017-0696791R3 F- Reduction of PUC/capital-- summary under Subsection 51(1) Summary Under Tax Topics- Income Tax Act- Section 51- Subsection 51(1) s. 51(1) will apply where convertible note, that was issued as boot, will be converted to shares Bco will transfer to a newly-incorporated subsidiary (Newco) all its shares of a wholly-owned subsidiary (Cco) on a s. 85(1) rollover basis in consideration for common shares and a demand non-interest bearing promissory note (the "Bco-Newco Note"), which is convertible after a specified period at the holder’s option into Newco common shares with an FMV equaling that of the note. ...

It had acquired such shares as the agreed consideration for issuing shares to the shareholders of a non-resident target under a Delaware merger, and was ruled to have a cost for those shares of Merger Sub1 equal to the FMV of the shares that were so issued by it (together with any related costs incurred by it). ...

Following the death of Mother, her estate and Trust were to engage in a pipeline transaction under which: The estate and Trust transfer their Aco shares under s. 85(1) to a Newco of Trust in consideration for Newco preferred shares. ...

IV circularity avoided through establishing year ends for TCs before DC wound up into TCs Under a two-wing split-up net asset butterfly, the five siblings who were the shareholders of the distributing corporation (DC) transferred their shares of DC on a s. 85 rollover basis to two transferee corporations (the TCs) formed respectively for four of the five siblings and for the fifth sibling, the two types of property were transferred on a pro rata and net asset rollover basis to the two TCs for consideration including TC preferred shares, those preferred shares were redeemed for notes, the TCs immediately established their first taxation year-ends and DC was wound up into the TCs under s. 88(2) (with the redemption notes being extinguished by operation of law and with any remaining CDA account flushed out using s. 88(2)(b)(i)). ...

A payment made in exchange for the listing of a business's name or logo on a web page may be consideration for a supply of advertising rather than a "sponsorship" where it is a commercial transaction at fair market value. ...

The charge in respect of a loaner vehicle under either the basic warranty coverage or Service Contract is part of the consideration for the supply of the repair service. … ...

In consideration for separate licensing fees paid to Corp A, there will commence to be a "separate acquisition of [equipment] Software in digital or CD-ROM media from Corp A;" and the Canadian distributor will license such software to third party customers. ...