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10 October 2014 APFF Roundtable, 2014-0538261C6 F- Disposition of capital interest/personal trust-- summary under Cost Amount Summary Under Tax Topics- Income Tax Act- 101-110- Section 108- Subsection 108(1)- Cost Amount note issuance is not trust property distribution to a beneficiary In order to settle the capital interest in a discretionary family trust of a beneficiary who is related to the trustees, that beneficiary agrees to renounce his interest in consideration for $200,000 paid by the trust as to $50,000 in cash and as to $150,000 by the issuance of a promissory note due by the trust in 5 years' time and bearing interest at 5%. ...

10 October 2014 APFF Roundtable, 2014-0538261C6 F- Disposition of capital interest/personal trust-- summary under Paragraph 20(1)(c) Summary Under Tax Topics- Income Tax Act- Section 20- Subsection 20(1)- Paragraph 20(1)(c) non-deductible interest on note issued to beneficiary In order to settle the capital interest in a discretionary family trust of a beneficiary who is related to the trustees, that beneficiary agrees to renounce his interest in consideration for $200,000 paid as to $50,000 in cash and as to $150,000 by the issuance of a promissory note due in 5 years' time and bearing interest at 5%. ...

[W]e have not had the opportunity to give full consideration to whether the above position should apply for purposes of [s. 104(4)(a).] ...

12 February 2014 Internal T.I. 2012-0443391I7- cross-border loans and deductibility of interest-- summary under Paragraph 20(1)(c) Summary Under Tax Topics- Income Tax Act- Section 20- Subsection 20(1)- Paragraph 20(1)(c) interest deductible when satisfied with common shares issued in pre-FAD-rule foreign afiliate dumping transactions Canco purchased common shares of Foreign Sub (a subsidiary of Parentco) from its foreign parent (Parentco) in consideration for treasury shares. ...

After noting that Chan indicated that a distribution under s. 107(2) is an allotment made in accordance with the beneficiary's interest and not made for consideration, CRA stated: Under the law of equity, fiduciary duties are imposed on a trustee and are enforceable by the beneficiaries of a trust. ...

Consideration should also be given to any factors which could have an effect on the relative value of any of the units in the building. ...

The corporation no longer needs the policy on the executive’s retirement, and it transfers the policy to him for no consideration at a time when the particulars are: Death benefit $1,000,000 Cash surrender value $ 125,000 Adjusted cost basis $ 50,000 Fair market value $ 125,000 Without being queried on this issue, CRA stated: Although there are certain exceptions in the "advantage" definition, a benefit arising from the RCA holding a life insurance policy is not among them. ...

After discussing the potential application of s. 15(1.4)(c), CRA stated (TaxInterpretations translation): Alternatively…the difference between the fair market value of property transferred and the consideration received by Corporation A could be included in computing the income of Holdco pursuant to subsection 56(2) to the extent that it was possible to demonstrate that a payment or transfer of property (the capital property) was made by Corporation A pursuant to the direction of, or with the concurrence of, Holdco, to the spouse of Shareholder 4…and was desired by Holdco to be conferred on the spouse...and to the extent that a payment or transfer of property would be included in the income of Holdco if such payment or transfer had been made by Corporation A to Holdco. ...

11 June 2015 External T.I. 2014-0522641E5 F- Usufruct-- summary under Subsection 73(3) Summary Under Tax Topics- Income Tax Act- Section 73- Subsection 73(3) creation of usufruct between father and son entails transfer of trust interest, not farm property A father, who has carried on a farming business for a number of years, grants the bare ownership of the property for consideration to his son while retaining rights as the usufructuary. ...

X 100 Class A shares for nominal consideration and also issues 100 discretionary dividend shares to Holdco. ...