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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. ...

LLC (“Sisterco LLC”) and the consideration paid, and also proposed a secondary adjustment under s. 247(12) on the basis that a resulting benefit conferred on Sisterco LLC was deemed to be a dividend that was paid by Canco that was subject to a Pt. ...

It did so by transferring that business to a newly-incorporated U.S. subsidiary (Splitco) in consideration for Splitco common shares, and then distributing those shares on the Original Shares (with the Original Shares ultimately being cancelled). ...

., it was consideration for the disposition of the leasehold interest (used as a principal residence) that the tenant had acquired in 2013 and held since then to the time of the lease termination. ...

A transferred his shareholding of Opco 1 (wholly-owned by him) to a corporation (Opco 2) equally owned by him and his spouse in consideration for a note. ...

8 July 2020 CALU Roundtable Q. 7, 2020-0842251C6- Valuation of private company shares-- summary under Other Summary Under Tax Topics- General Concepts- Fair Market Value- Other special voting shares generally are not accorded value CRA confirmed a previous position that “provided that the owners of all the shares of the corporation act in a manner consistent with the assumption that no value attaches to the voting rights, and the rights are eventually extinguished for no consideration, the CRA will generally not attribute value to the rights,” so that, for example, “in the context of an estate freeze of a Canadian-controlled private corporation, where the freezor, as part of an estate freeze, keeps controlling non-participating preference shares in order to protect his economic interest in the corporation, the CRA generally accepts not to take into account any premium that could be attributable to such shares for the purposes of subsection 70(5).” ...

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. ...

26 October 2020 External T.I. 2020-0856791E5- CEWS- meaning of inflow-- summary under Subsection 125.7(4) Summary Under Tax Topics- Income Tax Act- Section 125.7- Subsection 125.7(4) CRA will not issue rulings or TIs on what is normal accounting practice for CEWS purposes Regarding a question as to the timing of recognition of qualifying revenue, whose definition in s. 125.7)1) referred to the “inflow” of cash, receivables or other consideration arising in the course of the eligible entity’s ordinary activities in Canada, CRA stated: Subsection 125.7(4) enacts that the qualifying revenue of an eligible entity is generally determined in accordance with its normal accounting practices. ...

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. ...