Search - consideration

Principal Issues: Whether a fee for a letter of credit is consideration for agreement to lend money or make money available. ... Paragraph 214(15)(b) of the Act provides that any amount paid by a resident of Canada to a non-resident as consideration for "agreeing to lend money or make money available shall, if the non-resident person would be liable to tax under this Part in respect of interest payable on any obligation issued under the terms of the agreement on the date it was entered into, be deemed to be a payment of interest". ...

Brooks 2003-001923 July 17, 2003 Dear XXXXXXXXXX: This is in reply to your letter of May 14, 2003, in which you requested our views concerning the ability of a testamentary trust to qualify as a spousal trust where the will that created the trust authorizes the trustee to lend funds or provide any other financial assistance to any beneficiary with or without consideration. ... However, where the trust agreement permits funds to be loaned (or any other form of assistance to be provided) to anyone other than the spouse for inadequate consideration, it is our view that such a trust would not qualify. ...

In general, a "gift" for purposes of the Income Tax Act ("the Act") means a voluntary transfer of property without valuable consideration to the donor. Proposed amendments to the Act will allow the Canada Revenue Agency to recognize a gift, for tax purposes, in certain circumstances where a donor has received consideration for property transferred to a charity or other qualifying donee after December 20, 2002. ...

Subsection 66(12.601) of the Act allows the renunciation of specified Canadian development expenses to holders of flow-through shares if the issuing corporation's taxable capital amount is not more than $15,000,000 at the time the consideration for the issuance of the flow-through shares was given. ... In our view, provided B Co. has been dissolved (i.e., ceased to exist) prior to the time the consideration for the flow-through shares is given, B Co will not be associated with A Co. at the relevant time and, therefore, the amount computed under paragraph 66(12.6011)(b) will be nil. ...

A principal-business corporation ("PBC") as defined in subsection 66(15) of the Act, may renounce specified Canadian development expenses ("specified CDE") to holders of flow-through shares pursuant to subsection 66(12.601) of the Act if the corporation's taxable capital amount at the time the consideration for the shares was given, was not more than $15,000,000. For the purpose of determining the taxable capital amount of Amalco in the circumstances described above, subsection 66(12.6013) of the Act deems Amalco to have a taxable capital employed in Canada equal the total of all amounts each of which is the taxable capital employed in Canada of a predecessor corporation for the last taxation year that ended more than 30 days before the consideration for the issuance of the flow-through shares was given. ...

The determination of whether any incremental value realized on the exercise of the stock option represents business income or a capital gain can only be made after consideration of all the relevant facts and circumstances. Where the facts indicate that the incremental value represents part of the consideration received by the taxpayer for his or her consulting fees, we are of the opinion that the incremental value should be treated as business income for purposes of the Act. ...

CALU- Conference for Advanced Life Underwriting (2004) Question 6 Transfer of a Life Insurance Policy Under Which More Than One Child is Insured Subsection 148(8) provides rollover treatment when a policyholder transfers a life insurance policy to a child of the policyholder for no consideration if a child of the policy or of the transferee is the life insured. ... The father transfers ownership of the policy to his son for no consideration. ...

Note that if a taxpayer rents property to a non-arm's length party for less than fair market consideration, subsection 69(1) of the Act may be applied to deem the taxpayer to have received fair market value consideration. ...

Generally, we consider a plan to be a pension fund or plan where contributions have been made to the plan by or on behalf of an employer or former employer of an employee in consideration for services rendered by the employee and the contributions are used to provide an annuity or other periodical payment on or after the employee's retirement in consideration for his or her employment services. ...

For example, Black's Law Dictionary defines a "bonus" as "a consideration or premium paid in addition to what is strictly due" and "(a) premium or extra or irregular remuneration in consideration of offices performed or to encourage their performance. ...