Subsection 104(1) - Reference to trust or estate
Cases
British Columbia Investment Management Corp. v. Canada (A. G.), 2018 BCCA 47, aff'd 2019 SCC 63
bcIMC was a BC Crown agent which was formed to manage and hold investments for the provincial pension plans. The governing Act created a...
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| Tax Topics - Other Legislation/Constitution - Constitution Act, 1867 - Section 125 | imposition of GST on investment assets held by a provincial Crown agent would have been prohibited by its governmental immunity but for the reciprocal taxation agreement | 515 |
| Tax Topics - Excise Tax Act - Section 122 | deeming services provided by B.C. Crown agent in managing assets held in trust trenched on B.C. crown immunity | 249 |
| Tax Topics - Excise Tax Act - Section 267.1 - Subsection 267.1(5) - Paragraph 267.1(5)(a) | services of trustees of managing assets held in trust would not be supply in absence of s. 267.1(5)(a) | 170 |
| Tax Topics - Other Legislation/Constitution - Federal - Federal Courts Act - Section 19 | enforcement of a reciprocal taxation agreement was possible pursuant to the Federal Courts Act | 246 |
Canada v. Sommerer, 2012 DTC 5126 [at at 7219], 2012 FCA 207
Before allowing the taxpayer's appeal from an assessment made on the basis that s. 75(2) applied to attribute a capital gain realized by an...
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| Tax Topics - Income Tax Act - Section 248 - Subsection 248(5) | 84 | |
| Tax Topics - Income Tax Act - Section 75 - Subsection 75(2) | does not apply to FMV purchases | 236 |
| Tax Topics - Treaties - Income Tax Conventions | treaty applies to economic double taxation | 356 |
| Tax Topics - Treaties - Income Tax Conventions - Article 13 | attributed gain not included | 415 |
Fundy Settlement v. Canada, 2012 DTC 5063 [at at 6881], 2012 SCC 14, [2012] 1 S.C.R. 520, aff'g sub nom St. Michael Trust Corp. v. The Queen, 2010 DTC 5189 [at 7361], 2010 FCA 309, aff'g sub nom Garron v. The Queen, 2009 DTC 1568, 2009 TCC 450
A Barbados-resident corporation was the trustee of two trusts. The Court found that the trusts were resident in Canada because that is where the...
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| Tax Topics - Income Tax Act - Section 2 - Subsection 2(1) | central management and control test for trust residence | 262 |
Antle v. Canada, 2010 DTC 5172 [at at 7304], 2010 FCA 280
A purported Barbados trust that was used in connection with a tax plan to avoid Canadian capital gains tax on the disposition of shares of a...
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| Tax Topics - General Concepts - Sham | trust deed did not reflect the factual expectatons of the settler and trustee | 223 |
See Also
Goldman v. The Queen, 2021 TCC 13
The taxpayer’s mother, Ms. Goldman, orally told the taxpayer that she was designating the taxpayer (who was also appointed as the executor) as...
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| Tax Topics - Income Tax Act - Section 160 - Subsection 160(1) | s. 160(1) did not apply to a transfer to an individual qua trustee of a valid oral trust | 483 |
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(2) | trustee had no liability for application of s. 160(1) to transfer to the trust, absent s. 159(3) | 215 |
| Tax Topics - Income Tax Act - Section 159 - Subsection 159(3) | CRA could have assessed taxpayer qua trustee, for the s. 160(1) liability of her trust arising on its settlement, under s. 159(3) given the distribution of the corpus without a certificate | 193 |
| Tax Topics - Other Legislation/Constitution - Federal - Tax Court of Canada Rules (General Procedure) - Section 49 - Subsection 49(1) | “taking note” of a fact pleaded by the taxpayer is not a permitted Crown response | 131 |
Canada (Attorney General) v. British Columbia Investment Management Corp., 2019 SCC 63, [2019] 4 S.C.R. 559
BCI was a BC Crown agent which was formed to manage and hold investments for the provincial pension plans. The governing Act (the “PSPSA”) and...
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| Tax Topics - Other Legislation/Constitution - Constitution Act, 1867 - Section 125 | ETA taxes that would be borne by portfolio of which a Crown agent was legal owner would contravene s. 125 | 298 |
| Tax Topics - Statutory Interpretation - Interpretation Act - Section 8.1 | “trust” interpreted in accordance with its common law meaning | 349 |
| Tax Topics - Excise Tax Act - Section 122 | s. 122 does not preclude imposition of collection duties | 302 |
Milne Estate (Re), 2019 ONSC 579
Each of the late Mr. and Mrs. Milne had a primary will, which dealt with property for which the executors determined that grant of authority by a...
Moules Industriels (C.H.F.G.) Inc. v. The Queen, 2018 TCC 85
The taxpayers, in connection with arguing (at para. 62) that the reference in the preamble to s. 256(1.2)(f)(ii) to “shares … owned .. by a...
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| Tax Topics - Income Tax Act - Section 256 - Subsection 256(1.2) - Paragraph 256(1.2)(f) - Subparagraph 256(1.2)(f)(ii) | a numerical cap on trustees’ discretion to allocate income or capital did not stop tainting under s. 256(1.2)(f)(ii) | 245 |
Canada v. Cheema, 2018 FCA 45
In order to satisfy lender requirements, the individual taxpayer persuaded a friend (Dr. Akbari) to jointly sign an agreement for the purchase of...
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| Tax Topics - Excise Tax Act - Section 254 - Subsection 254(2) - Paragraph 254(2)(b) | third party who did not intend to occupy was liable at the purchase agreement time | 355 |
| Tax Topics - Excise Tax Act - Section 133 | s. 133 deemed an acquisition of future home on co-purchaser's signing purchase agreement, notwithstanding that no beneficial interest received on closing | 268 |
| Tax Topics - Statutory Interpretation - Ordinary Meaning | Court should not depart from usual interpretation principles in seeking a sensible result | 128 |
| Tax Topics - Statutory Interpretation - Ease of Administration | interpretation that favours administrative efficiency is to be favoured | 206 |
| Tax Topics - Excise Tax Act - Regulations - New Harmonized Value-Added Tax System Regulations, No. 2 - Section 40 | co-purchaser with no intended beneficial interest was required to satisfy ETA s. 254(2) rules | 171 |
Barclays Wealth Trustees (Jersey) Limited v. Commissioners for Her Majesty's Revenue and Customs, [2017] EWCA Civ 1512
On June 21, 2001, an Ireland-domiciled individual (“Dreelan”) paid £100 to a New Jersey trustee (with successors, the “Trustee”) to hold...
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| Tax Topics - Statutory Interpretation - Interpretation/Definition Provisions | trreat as real the inevitable incidents of the deemed fiction | 233 |
Markou v. The Queen, 2016 TCC 137
In connection with a leveraged donation arrangement, the taxpayers in the lending agreement directed the lender (“Capital”) to deliver the...
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| Tax Topics - Statutory Interpretation - Interpretation Act - Section 8.1 | TCC has jurisdiction to determine existence of equitable remedy | 96 |
| Tax Topics - General Concepts - Payment & Receipt | funds in leveraged donation scheme essentially advanced by lender directly to charity | 108 |
Advocate Gen. for Scotland v. Murray Group Holdings Ltd., [2015] CSIH 77, [2015] BTC 36 (Ct. of Ses. (Inner House, 2nd)), aff'd sub nomine RFC 2012 Plc (formerly The Rangers Football Club Plc) v Advocate General for Scotland (Scotland) [2017] UKSC 45
In the course of finding that the (Scottish) Inner Court was entitled to decide on questions of English trust law that were relevant to a tax...
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| Tax Topics - Income Tax Act - Section 6 - Subsection 6(1) - Paragraph 6(1)(a) | income derived from service is assessable even where agreed to be redirected to 3rd party | 329 |
| Tax Topics - General Concepts - Evidence | Scottish Court of Session entitled to deal with questions of English law | 300 |
Mariano v. The Queen, 2015 DTC 1209 [at at 1331], 2015 TCC 244
The taxpayers were participants in leveraged donation transactions which included gifts of courseware licences to a Canadian–resident Trust with...
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| Tax Topics - General Concepts - Fair Market Value - Other | courseware licences valued at modest initial cost, given relevant wholesale market and depressive effect of huge volumes purchased | 303 |
| Tax Topics - General Concepts - Ownership | no acquisition of unascertained property | 76 |
| Tax Topics - General Concepts - Sham | taxpayer involvement in deceit unnecessary | 375 |
| Tax Topics - Income Tax Act - 101-110 - Section 107 - Subsection 107(2) | delegation of power of appointment to promoter not authorized | 238 |
| Tax Topics - Income Tax Act - Section 118.1 - Subsection 118.1(1) - Total Charitable Gifts | no gift where no intent for impoverishment and where gifted property not yet identified | 566 |
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(35) | attempted use of initial gift to step-up ACB under s. 69(1)(c) | 262 |
Al-Hossain v. The Queen, 2014 TCC 379
To secure mortgage financing for his home purchase, the appellant's friend ("Khandaker") agreed to co-sign the mortgage documents and to be placed...
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| Tax Topics - Excise Tax Act - Section 254 - Subsection 254(2) | co-owner was not occupant and bare trust declaration was too late | 282 |
| Tax Topics - General Concepts - Effective Date | bare trust declaration was too late | 138 |
Sheila Holmes Spousal Trust v. Canada (Attorney General), 2013 ABQB 489
The federal Minister assessed the settlor of the appellant trust on the basis that the trust's taxable capital gain and investment income were...
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| Tax Topics - General Concepts - Rectification & Rescission | superior court declines jurisdiction in tax dispute | 215 |
Peragine v. The Queen, 2012 DTC 1287 [at at 3887], 2012 TCC 348
Webb J. found that the taxpayer held a real property as an agent (and hence as a bare trustee) of his brother. The evidence consistently showed...
Lipson v. The Queen, 2012 DTC 1064 [at at 2796], 2012 TCC 20
The taxpayers received a number of capital distributions from the liquidator of their mother's "succession" (a Quebec estate), but only filed a...
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| Tax Topics - Income Tax Act - Section 116 - Subsection 116(3) | 184 | |
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Taxable Canadian Property | 184 |
Fourney v. The Queen, 2012 DTC 1019 [at at 2575], 2011 TCC 520
Seeking to protect herself from being sued by her brother, the taxpayer transferred title to all her real properties for no consideration to...
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| Tax Topics - General Concepts - Agency | 191 | |
| Tax Topics - General Concepts - Corporate/Separate Personality | 257 | |
| Tax Topics - General Concepts - Ownership | presumption of resulting trust where property transfer for no consideration | 257 |
| Tax Topics - Income Tax Act - Section 163 - Subsection 163(2) | line codes in electronic filings were incomprehensible to taxpayer | 300 |
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Disposition | rebuttable presumption of resulting trust on transfer for no consideration | 257 |
Canpar Developments Inc. v. The Queen, 2011 GSTC 118, 2011 TCC 353 (Informal Procedure)
The taxpayer's transfer of a real property to its two shareholders, made for the purpose of securing a bank loan, did not give rise to an implicit...
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| Tax Topics - Excise Tax Act - Section 285 | 224 |
Canada v. General Motors of Canada Limited, [2009] GSTC 64, 2009 FCA 114
GMCL (a car manufacturer), which was the administrator of various defined benefit pension plan trusts for its employees, and for which Royal Trust...
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| Tax Topics - Excise Tax Act - Section 169 - Subsection 169(1) | services for pension plans represented compensation costs relating to taxable sales | 133 |
| Tax Topics - Income Tax Act - Section 169 - Subsection 169(1) | 99 | |
| Tax Topics - Excise Tax Act - Section 267.1 - Subsection 267.1(2) | administrator of pension trust was not a trustee, and not subject to s. 267.1 | 51 |
De Mond v. R., 99 DTC 893, [1999] 4 CTC 2007 (TCC)
The taxpayer settled a trust governed by U.S. law (the “Family Trust”) for the purpose of ensuring that its property could be rolled into...
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| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(2) | 90 |
Administrative Policy
22 July 2023 Internal T.I. 2021-0883241I7 - Entity classification of Liechtenstein stiftung
A Liechtenstein stiftung was formed as a family foundation (later changed to a private-benefit foundation), with a capital contribution from the...
2024 Ruling 2019-0817961R3 - Swiss Collective Investment Scheme
A collective investment scheme (the “Fund”) established under Swiss law is an arrangement by which investors pool their assets to be managed...
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| Tax Topics - Treaties - Income Tax Conventions - Article 10 | Swiss collective investment vehicle treated as flow-through for purposes of the pension/ retirement fund dividend exemption in the Canada-Swiss treaty | 259 |
29 November 2022 CTF Roundtable Q. 9, 2022-0950531C6 - Multiple Wills and T3 Reporting
Where an individual has two wills (one of them not being subject to probate) so that the two wills are administered separately, does s. 104(2)...
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| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(2) | s. 104(2) cannot apply where there are multiple wills since there is only one trust | 113 |
15 June 2022 STEP Roundtable Q. 16, 2022-0927601C6 - Foreign Entity Classification of a Foundation
Is a foundation created under the laws of a country where civil law applies treated as a trust under the Act?
After referring to its two-step...
7 October 2021 APFF Financial Strategies and Instruments Roundtable Q. 6, 2021-0896061C6 F - Prolonged Administration of an Estate
The will of Mr. X, a resident of Quebec, left all of his property in equal shares, to his two children, aged 10 and 15. His will included an...
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| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(18) | s. 104(18) can apply where an executor has discretion to defer the payment of income for the benefit of minor beneficiaries over an extended period | 330 |
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(6) | s. 104(18) overrode the s. 104(6) requirement to make income payable in the year | 295 |
2018 Ruling 2017-0738041R3 - XXXXXXXXXX
Fund
The Fund constitutes a collective investment vehicle that is not a body corporate, a partnership or a limited partnership, under which the...
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| Tax Topics - Income Tax Act - Section 212 - Subsection 212(1) | collective investment vehicle treated as transparent for Pt XIII purposes | 179 |
2017 Ruling 2015-0605161R3 - Fonds commun de placement (FCP) - Luxembourg
Fund and Sub-Funds
The Fund, which is UCITS (collective investment in transferable securities) constituted under the Luxembourg law of contract as...
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| Tax Topics - Income Tax Act - Section 96 | Luxembourg investment mutual fund was a co-ownership arrangement | 144 |
2016 Ruling 2015-0606141R3 - XXXXXXXXXX
Current structure
The Umbrella Fund is an open-end fund with Subfunds, all of them governed by Fund Contracts under the laws of a common law...
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| Tax Topics - Income Tax Act - Section 96 | common contractual fund was fiscally transparent | 129 |
12 July 2016 External T.I. 2014-0560361E5 - Cdn beneficiary of US living trust
A U.S. revocable living trust is a trust that is usually controlled by and established for the benefit of those who created the trust...
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| Tax Topics - Income Tax Act - Section 75 - Subsection 75(2) | potential application to U.S. revocable living trust | 190 |
| Tax Topics - Income Tax Act - Section 126 - Subsection 126(1) | whether there is a foreign tax credit for US tax paid by the grantor of a revocable US living trust | 256 |
10 June 2016 STEP Roundtable Q. 10, 2016-0645781C6 - US Revocable Living Trusts
A U.S. resident (the “grantor”) settles a “revocable living trust” with property including taxable Canadian property. The grantor: is the...
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| Tax Topics - Income Tax Act - Section 70 - Subsection 70(5) | transfer to remainder beneficiary of a U.S. revocable living trust on death does not occur as a consequence of death | 126 |
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(8) - Paragraph 248(8)(a) | remainder beneficary of inter vivos trust | 165 |
2014 Ruling 2013-0496831R3 - Irish Common Contractual Fund
Description of CCF
"CCF" is a common contractual fund established pursuant to the Investment Funds, Companies and Miscellaneous Provision Act 2005...
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| Tax Topics - Income Tax Act - Section 96 | Irish common contractual fund respected as co-ownership | 54 |
22 November 2013 External T.I. 2013-0511771E5 - Beneficial Ownership - Disposition
As the taxpayer's daughter did not qualify for a mortgage at the time of her purchase of her home, the bank required legal title to be placed in...
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| Tax Topics - General Concepts - Ownership | mother as nominee for daughter's house | 94 |
8 May 2012 CALU Roundtable Q. 6, 2012-043564
Shareholders of a corporation use a buy-sell agreement to requires the corporation to acquire insurance on the shareholders' lives (and pay the...
7 October 2011 Roundtable, 2011-0411841C6 F - Succession
As of June 30, 2011, all the liabilities of Succession X have been paid and all the liquidator's duties have been completed, and its only asset of...
15 July 2010 Internal T.I. 2010-0353701I7 - Classification foreign entity - Trust Enterprise
Ruling that a Liechstenstein Trust Enterprise would be a trust rather than a corporation. Although it had centralized control, continuity of...
4 October 2010 Internal T.I. 2008-0289461I7 - Netherlands Antilles private foundation
A private foundation was created pursuant to the laws of the Netherlands Antilles and governed by Articles of Foundation. Its capital consists of...
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| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Corporation | Netherlands Antilles private foundation qualifies as a trust notwithstanding its separate legal personality | 109 |
2010 Ruling 2009-0345011R3 - Irish Common Contractual Fund
Irish contractual funds, which gave the unitholders proportionate undivided co-ownership interests in the assets of each "sub-fund (i.e.,...
9 June 2010 External T.I. 2009-0342081E5 F - Associé déterminé
Before going on to indicate that at trust could be considered to be actively engaged in the activities of a general partnership for purposes of...
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| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Specified Member | trust member of partnership can be actively engaged through the activities of its trustee | 176 |
18 September 2008 External T.I. 2008-0264381E5 F - Résidence d'une fiducie
Non-resident individuals entrusted the custody of certain funds to the Quebec office of a Canadian financial institution, which held the funds in...
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| Tax Topics - Income Tax Act - Section 2 - Subsection 2(1) | holding of assets by Canadian securities depositary and custodian would not be relevant to trust residence | 220 |
11 October 2007 Internal T.I. 2007-0236981I7 - Pennsylvania Business Trust
Before finding that a Pennsylvania business trust (PBT) was a trust for ITA purposes, the Directorate stated:
Professor Waters suggests that the...
2006 Ruling 2006-0199741R3 - Irish Common Contractual Fund
CCF
A Common Contractual Fund ("CCF") is a type of collective investment undertaking under which Unitholders by contractual arrangement acquire,...
28 April 2004 Internal T.I. 2004-0071191I7 F - À quoi se rattache l'élément contrôle/propriété?
Regarding whether the reference to a trust or an estate in s. 104(1) is equivalent to a reference to an heir without having ownership or control...
2006 Ruling 2004-0106101R3 - Class of German Arrangement & Treaty Benefits
Ruling that an open-end real estate fund established under the Investment Companies Act (Germany) (and to be continued under the Investment Act...
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| Tax Topics - Treaties - Income Tax Conventions - Article 4 | 26 |
2004 Ruling 2004-0067771R3 - Irish Common Contractual Fund
Ruling that an Irish Common Contractual Fund would be considered to constitute a co-ownership arrangement.
20 May 2002 External T.I. 2002-0117885 F - Lien de dépendance et application de 120.4
CCRA indicated that a trust is related to an individual if its trustee is so related:
Subsection 104(1) provides in part that, for the purposes of...
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| Tax Topics - Income Tax Act - Section 251 - Subsection 251(2) - Paragraph 251(2)(a) | trustee is related to individual if its trustee is so related | 99 |
| Tax Topics - Income Tax Act - Section 120.4 - Subsection 120.4(1) - Split Income - Paragraph (c) | split income definition applied on the basis that the business of a partnership is carried on by its partners and that a trust if related based on the relatedness of its trustee | 311 |
18 February 2002 External T.I. 2000-0046075 - Trust Affiliated with a Corporation
The purpose of the amendment to s. 104(1) adding "unless the context otherwise requires" was not to make a fundamental change. Although a...
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| Tax Topics - Income Tax Act - Section 251.1 - Subsection 251.1(1) | 30 |
20 February 2002 External T.I. 2001-0105695 F - Remboursement d'impôt d'une fiducie liquidée
In finding that the potential tax refund resulting from the Quebec abatement to which a mutual fund trust was entitled should be paid to the...
10 January 1996 External T.I. 9518515 - Transfers of property to revocable living trusts
Would a transfer of appreciated capital property to a revocable inter vivos trust (also referred to as a revocable living trust), which is not a...
IT-216 "Corporation Holding Property as Agent for Shareholder"
- A corporation may hold in trust, as agent for a shareholder, property that was acquired specifically to be held in this way. This situation,...
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| Tax Topics - General Concepts - Agency | 0 | |
| Tax Topics - General Concepts - Effective Date | 89 |
Articles
Tina Korovilas, Drew Morier, "Non-Corporate Vehicles in the Foreign Affiliate Context", 2018 Conference Report (Canadian Tax Foundation), 20:1 – 114
Quaere whether beneficiary is beneficial owner (pp. 20:7-8)
Some commentators argue that a beneficiary of a trust is the beneficial owner of...
Elie Roth, Tim Youdan, Chris Anderson, Kim Brown, "Classification of Trusts for Income Tax Purposes", Chapter 2 of Canadian Taxation of Trusts (Canadian Tax Foundation), 2016.
Non-application to bare trusts (p. 86)
[T]he non-applicability of the Act to bare trusts has been recognized by the courts. [fn 107: …Brookview...
Donald G.H. Bowman (former Chief Justice of the Tax Court of Canada), "Bare Trusts and Nominee Corporations", Tax Topics (Wolters Kluwer), August 11, 2016, No. 2313, p. 1
Trustee cannot also be an agent (p.4)
My reason for thinking that a trustee holding property or carrying on a business for a beneficiary cannot at...
Jack Bernstein, "Trust Residence Question", Canadian Tax Highlights, Vol. 17, No. 7, July 2009, p. 1
Discussion of CRA audits of residence of inter-provincial trusts.
Subsection 104(2) - Taxed as individual
Cases
Olympia Trust Company v. Canada, 2015 FCA 279
Ryder JA affirmed a finding of Bocock J that a Canadian trust company, which was the trustee for self-directed RRSPs that had purchased shares...
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| Tax Topics - Income Tax Act - Section 116 - Subsection 116(5) | RRSP trustee, not annuitant, was the "purchaser" | 200 |
| Tax Topics - General Concepts - Evidence | contract informed by surrounding circumstances | 59 |
Fraser v. The Queen, 91 DTC 5123 (FCTD), aff'd 95 DTC 5684 (FCA)
Approximately 100 taxpayers invested in a pool of mortgages by paying a subscription price for "units" to two companies, that used the proceeds to...
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|---|---|---|
| Tax Topics - Income Tax Act - Section 75 - Subsection 75(2) | 60 |
Smith v. The Queen, 87 DTC 5355, [1987] 2 CTC 138 (FCTD)
Under a shareholder's agreement containing a right of first refusal, it was agreed that the shares held by the taxpayer would be sold in equal...
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| Tax Topics - Income Tax Act - Section 173 - Subsection 173(1) | 88 |
Drescher v. The Queen, 85 DTC 5064, [1985] 1CTC 229 (FCTD)
It was found that family members each bought lottery tickets on the understanding that gains would be shared among them. It accordingly was held...
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|---|---|---|
| Tax Topics - Statutory Interpretation - Provincial Law | 52 |
Bouchard v. The Queen, 83 DTC 5193, [1983] CTC 173 (FCTD)
It was found that real property, which had been purchased by the plaintiff and his wife, had been held by them in trust over a 13-year period for...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - General Concepts - Effective Date | parol trust over land has effect for tax purposes from its formation - at least, if subsequently confirmed in writing | 160 |
| Tax Topics - General Concepts - Evidence | 74 | |
| Tax Topics - Income Tax Act - Section 6 - Subsection 6(1) - Paragraph 6(1)(e) | 70 | |
| Tax Topics - Income Tax Act - Section 69 - Subsection 69(1) - Paragraph 69(1)(b) | 83 |
Atinco Paper Products Ltd. v. The Queen, 78 DTC 6387, [1978] CTC 566 (FCA)
Gifts were made by the supposed settlor of a trust to her nephews absolutely unencumbered by any limitation on them other than an expressed hope...
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|---|---|---|
| Tax Topics - General Concepts - Evidence | 18 | |
| Tax Topics - General Concepts - Tax Avoidance | 58 |
Ablan Leon (1964) Ltd. v. MNR, 76 DTC 6280, [1976] CTC 506 (FCA)
Trusts were not formed when a series of cheques were sent by the supposed settlor to another individual. "From the point of view of the settlor,...
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|---|---|---|
| Tax Topics - Income Tax Act - Section 9 - Nature of Income | 105 | |
| Tax Topics - Income Tax Act - Section 96 | 31 | |
| Tax Topics - Statutory Interpretation - Provincial Law | 101 |
The Queen v. Esskay Farms Ltd., 76 DTC 6010, [1976] CTC 24 (FCTD)
The taxpayer, in order to defer pursuant to s. 20(1)(n) the recognition of gain on the sale of land to the City of Calgary, agreed to sell the...
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|---|---|---|
| Tax Topics - General Concepts - Agency | weight given to written agreement terms in finding that intermediary purchased as principal | 122 |
| Tax Topics - General Concepts - Evidence | 81 | |
| Tax Topics - General Concepts - Sham | no sham if documents describe intended legal rights | 354 |
| Tax Topics - General Concepts - Tax Avoidance | no sham if documents describe intended legal rights | 354 |
| Tax Topics - Income Tax Act - Section 20 - Subsection 20(1) - Paragraph 20(1)(n) | 199 | |
| Tax Topics - Income Tax Act - Section 245 - Old | 57 | |
| Tax Topics - Income Tax Act - Section 246 - Subsection 246(1) | 195 | |
| Tax Topics - Statutory Interpretation - Provincial Law | 58 |
Kingsdale Securities Co. Ltd. v. The Queen, 74 DTC 6674, [1975] CTC 10 (FCA)
An alleged settlement of trusts (prior to the date of execution of the trust deeds) did not occur due to the lack of the requisite certainty of...
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|---|---|---|
| Tax Topics - General Concepts - Effective Date | 52 | |
| Tax Topics - Income Tax Act - Section 169 | 84 | |
| Tax Topics - Income Tax Act - Section 172 - Subsection 172(2) | 84 | |
| Tax Topics - Income Tax Act - Section 96 | 19 |
Settled Estates Ltd. v. Minister of National Revenue, 60 DTC 1128, [1960] CTC 173, [1960] S.C.R. 606
The combined presumption in ss. 104(1) and (2) that executors are deemed to be individuals for purposes of taxation of the estate did not apply...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Individual | 111 | |
| Tax Topics - Statutory Interpretation - Interpretation Act - Subsection 15(2) | contrary intention present | 51 |
See Also
Goldman v. The Queen, 2021 TCC 13
The taxpayer was designated as the beneficiary of her mother’s RRSP, but was orally told by her mother that this was occurring on the condition...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 160 - Subsection 160(1) | s. 160(1) did not apply to a transfer to an individual qua trustee of a valid oral trust | 483 |
| Tax Topics - Income Tax Act - Section 159 - Subsection 159(3) | CRA could have assessed taxpayer qua trustee, for the s. 160(1) liability of her trust arising on its settlement, under s. 159(3) given the distribution of the corpus without a certificate | 193 |
| Tax Topics - Other Legislation/Constitution - Federal - Tax Court of Canada Rules (General Procedure) - Section 49 - Subsection 49(1) | “taking note” of a fact pleaded by the taxpayer is not a permitted Crown response | 131 |
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(1) | oral instructions, before her death, by mother to daughter re application of the proceeds of her RRSP gave rise to a trust | 208 |
Evoy Estate v. The Queen, 2016 TCC 263
The will of a Canadian-resident individual established three separate testamentary trusts for each of his three children and their respective...
Howard v. Commissioner of Taxation, [2014] HCA 21
The taxpayer and four others formed a joint venture to acquire, lease and sell a golf course. The taxpayer attempted to have a corporation of...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 56 - Subsection 56(4) | agreement assigned rights to proceeds of law suit rather than entitlement under law suit | 344 |
| Tax Topics - Income Tax Act - Section 9 - Compensation Payments | damages not corporate income as not received qua director | 191 |
| Tax Topics - Income Tax Act - Section 9 - Nature of Income | agreement assigned rights to proceeds of law suit rather than entitlement under law suit | 344 |
De Mond v. R., 99 DTC 893, [1999] 4 CTC 2007 (TCC)
A trust established by the taxpayer was found to be a bare trust given that he could cause the trust property to revert to him at any time, could...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(1) | taxpayer characterized as playing the role of settlor, trustee and beneficiary of his “own” trust, so that it was a bare trust | 412 |
Stricker Oolup v. The Queen, 2003 DTC 2142, 2003 TCC 947 (Informal Procedure)
The taxpayer was able to rebut the presumption of resulting trust in favour of the estate when her grandmother, who with the taxpayer had been the...
Collins v. The Queen, 96 DTC 1034 (TCC)
Before rejecting a submission that the taxpayer held half of his shares of a private company on a constructive or resulting trust for his wife,...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - General Concepts - Ownership | ownership means beneficial ownership | 27 |
| Tax Topics - General Concepts - Substance | 108 |
Karavos v. The Queen, 95 DTC 1001 (TCC)
Before finding that, in any event, the taxpayer had failed to establish that one-half of his interest in a building was held on a constructive...
Gillis v. MNR, 91 DTC 1457, [1991] 2 CTC 2708 (TCC)
The presumption under common law and s. 21 of the Matrimonial Property Act (Nova Scotia) of resulting trust with respect to a transfer of property...
Nelson v. MNR, 91 DTC 37 (TCC)
Insufficient evidence was advanced to support the taxpayers' position that 1/2 of a farm was held on a constructive trust.
Fraser v. MNR, 89 DTC 620 (TCC)
A vehicle under which a company ("Marlowe-Yeoman") invested in and held mortgages on behalf of investors, who had the right to redeem their...
Zeidler v. Campbell (1988), 29 E.T.R. 113 (Alta. Q.B.)
A voting trust agreement did not give rise to a trust in light inter alia of the fact that the alleged trustee did not acquire any property in the...
Bank of Nova Scotia v. Societé General (Canada), [1988] 4 WWR 232 (Alta. C.A.)
An operator under the 1981 Canadian Association of Petroleum Landmen Operating Procedure held funds received from the non-operators in trust given...
Miconi v. MNR, 85 DTC 696, [1985] 2 CTC 2457 (TCC)
A real estate property was found to be beneficially owned by the taxpayer rather than by a corporation controlled by him, with the result that...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 15 - Subsection 15(2) | 95 |
Administrative Policy
29 November 2022 CTF Roundtable Q. 9, 2022-0950531C6 - Multiple Wills and T3 Reporting
An individual has two wills, only one of which is subject to probate. The two wills are administered separately, perhaps with different...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(1) | there is only one estate (and one T3 return) for a deceased, even if there are multiple wills | 111 |
26 April 2013 External T.I. 2013-0486211E5 - Multiple Trusts
CRA provided general comments respecting several situations where there are several testamentary trusts set up such that the spouse of a deceased...
28 December 2011 External T.I. 2011-0430261E5 - Subsection 104(2) of the Act
where a taxpayer dies leaving his property equally to three testamentary trusts of which his surviving spouse is the only capital and income...
5 March 2010 Internal T.I. 2009-0346261I7 F - Minimisation des pertes
Before concluding that a testamentary trust can qualify as an estate beneficiary for s. 112(3.2)(b) purposes, the Directorate stated:
[A]lthough...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 112 - Subsection 112(3.2) - Paragraph 112(3.2)(b) | a testamentary trust can qualify as an estate beneficiary for s. 112(3.2)(b) purposes | 208 |
| Tax Topics - Income Tax Act - Section 112 - Subsection 112(3.2) - Paragraph 112(3.2)(a) | respective purviews of ss. 112(3.2)(a)(ii)(A), (B) or (C) | 118 |
13 June 2007 External T.I. 2006-0178031E5 F - Biens détenus par des fiducies testamentaires
The will of Mr. A provides for transfers to three testamentary trusts(C-1, D-1 and E-1) for each of his three children and their children, and...
23 February 1999 External T.I. 9809755 - IN-TRUST ACCOUNTS
Where "in-trust accounts" are set up by parents for holding mutual fund investments on behalf of their minor children, the certainty of intention...
19 February 1999 Internal T.I. 9831647 - LAWYER'S TRUST ACCOUNT
Discussion of background to the position in IT-129R, para. 10, respecting the deposit of funds with lawyers pending the outcome of litigation.
22 September 1997 External T.I. 9717475 - IN-TRUST ACCOUNTS
Where an "in trust" account is set up to hold a mutual fund investment on behalf of children, the certainty of intention to set up a trust...
Income Tax Technical News, No. 7, 21 February 1996 (cancelled)
Where property is held by a bare trust, RC will ignore the trust for income tax purposes and will consider the transferor/settlor to be the owner...
8 March 1995 External T.I. 9433255 - CURTESY ELECTION - WHETHER A TRUST
A courtesy interest in a deceased married woman's estate that the surviving widower elects to receive, is not a trust but, rather, an interest in...
18 February 1994 External T.I. 9334285 F - Bare Trusts
Where a settlor transfers property to a trust having the characteristics according with RC's understanding of a bare trust (the settlor is the...
24 February 1993 T.I. (Tax Window, No. 29, p. 14, ¶2439)
The Crown can be constituted a trustee only by the express provisions of an Act of Parliament. Where the Crown is a trustee, the trustee will not...
31 March 1993 T.I. (Tax Window, No. 29, p. 8, ¶2444)
A trust that is a grantor trust for U.S. purposes will be treated as a bare trust for Canadian purposes, with the result that the settlor will be...
25 January 1993 Memorandum (Tax Window, No. 28, p. 22, ¶2398)
Two trusts need not operate concurrently nor need the trustees be the same for a designation under s. 104(2) to be made. Any such designation is...
October 1992 Central Region Rulings Directorate Tax Seminar, Q.Q (May 1993 Access Letter, p. 234)
In order for a bare trust to exist for purposes of the Act, the declaration of trust must have been entered into at the time the property in...
23 January 1992 T.I. (Tax Window, No. 16, p. 21, ¶1712)
A trust under which the trustee does not have any significant powers or responsibilities and does not take any action regarding the trust property...
18 November 1991 Memorandum (Tax Window, No. 11, p. 6, ¶1536)
If a trust is used to achieve a beneficial result for tax purposes not otherwise available to the settlor, this usually is an indication that the...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 102 - Subsection 102(1) | 36 |
10 May 1990 T.I. (October 1990 Access Letter, ¶1471)
Where the parties to an arrangement intend to create a trust for tax purposes and the custodian of the property acts as a trustee under an...
27 October 89 Memorandum (March 1990 Access Letter, ¶1147)
No provision of the Act allows a usufruct to be treated as a trust.
89 C.M.TC - "Bare Trusts"
general discussion
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Disposition | 43 |
88 C.R. - Q.31
A constructive trust is subject to the trust provisions of the Act.
88 C.R. - Q.32
Where a bare trust exists at common law, ss.104(1) and (2) will apply because the transferor transfers the legal title while retaining the...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 75 - Subsection 75(2) | 22 |
80 C.R. - Q.12
A minor cannot hold shares in a corporation and, in an estate freezing context, where a trust is used to hold shares for a minor, then it is...
79 C.R. - Q.24
RC usually considers settlor/beneficiary as the actual owner of the property in a bare trust, except that s. 104(1) or (2) is applied for the...
IT-129R "Lawyers' Trust Accounts and Disbursements"
Where funds are deposited with a lawyer by litigants for safekeeping and investment pending a court order or settlement, the income generated is...
Articles
Elie Roth, Tim Youdan, Chris Anderson, Kim Brown, "Taxation of Trusts Resident in Canada", Chapter 3 of Canadian Taxation of Trusts, (Canadian Tax Foundation), 2016.
Purpose of s. 104(2) (pp. 246-7)
Lloyd F. Raphael has stated that the "apparent purpose of [subsection 104(2)] is to prevent a settlor from...
Keith R. Hennel, "Escrow Arrangements in Acquisition Agreements: What Are You Creating?", CCH Tax Topics, No. 2176, November 21, 2013, p. 1
Whether an escrow arrangement represents a trust (p. 2)
As indicated by other commentators, poorly drafted escrow arrangements have resulted in...
Lipson, "The Bare Trust and the Element of Control", Tax Topics, No. 1214, 15 June 1995, p. 1.
Waters, "An Overview of the Law of Trusts", 1988 Conference Report, c. 35.
Subsection 104(4) - Deemed disposition by trust
See Also
Green v. The Queen, 2012 DTC 1061 [at at 2788], 2012 TCC 10 (Informal Procedure)
The taxpayer and his siblings received a real estate property from a testamentary trust on a rollover basis under s. 107(2) and sold the property....
Administrative Policy
2020 Ruling 2020-0844081R3 F - Rollout of property to beneficiaries
CRA ruled that s. 107(2) would apply to the distribution of the shares of two CCPCs (Zco, a holding company, and Xco, an investment company) by a...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 107 - Subsection 107(2) | s. 107(2) applicable to distribution of trust’s shares to beneficiaries followed by an immediate s. 85(1) roll into holdco controlled by father | 534 |
14 February 2014 Internal T.I. 2013-0490891I7 - Revocable Living Trust
On a date prior to 1988, the Trust was created and Mother (a U.S. resident) and each of her children (also U.S. residents) transferred their...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Disposition | revocable living trust formed on initial settlement date | 191 |
6 September 2013 External T.I. 2012-0459531E5 - Gross royalty trust units held by an estate
An estate administered by the Public Trustee potentially could remain in existence for more than 21 years. Accordingly, there could be a deemed...
22 March 2013 External T.I. 2012-0473661E5 - Joint Spousal or Common-Law Partner Trust Status
A joint spousal or common-law partner trust will maintain its status after a divorce for purposes of s. 104(4)(a), so that the deemed disposition...
6 December 1994 External T.I. 9419695 - APPLICATION OF 104(4) TO A NON-RESIDENT TRUST
A non-resident trust that is not subject to taxation in Canada is not subject to the deemed disposition rule in s. 104(4), with the result that...
25 April 1994 External T.I. 9409025 - COMMUNAL ORGANIZATION AND "21-YEAR RULE" FOR TRUSTS
S.104(4) will not apply to a communal organization which is deemed to be an inter vivos trust pursuant to s. 143(1) because of the exclusion in...
26 January 1994 Administrative Letter 9332406 F - Non-Resident Trusts and 21-Year Rule
S.104(4) also applies to non-resident trusts that own taxable Canadian property.
8 September 1993 T.I. (Tax Window, No. 33, p. 6, ¶2640)
The deemed realization rules in s. 104(4)(b) will apply to charitable and non-profit organizations which are trusts.
31 March 1993 T.I. (Tax Window, No. 29, p. 23, ¶2451)
Although s. 104(4) generally applies to revocable trusts, it does not apply to property held by bare trusts.
22 March 1993 T.I. (Tax Window, No. 29, p. 12, ¶2443)
Where the will of the testator directs the executor and trustee to hold the residue of the estate in trust for the testator's child for life and...
1993 CALU Conference, Q. 2 (C.T.O. "Insurance Policy and Fair Market Value of Shares - CALU")
Where a spousal trust owns shares of a corporation that owns an insurance policy on the life of the spouse, in determining the fair market value...
22 November 1991 T.I. (Tax Window, No. 13, p. 7, ¶1632)
A designation under s. 104(13.1) or (13.2) will not affect the status of a spousal trust.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 70 - Subsection 70(6) | 16 |
Articles
W.P. Goodman, "How to Minimize the Impact of the Deemed Realization of Trust Property", Goodman on Estate Planning, Vol. VII, No. 1, p. 493.
Paragraph 104(4)(a)
See Also
Grimes v. The Queen, 2016 TCC 280
The taxpayer trust was deemed under s. 104(4)(a) to dispose of its property at fair market value. The FMV of its shares of a Holdco wholly-owning...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - General Concepts - Fair Market Value - Shares | no discount for shareholder-level taxes, minority discount re NAL party’s voting control, marketability discount, advances valued at nil given practice of converting to bonuses | 659 |
Administrative Policy
4 June 2024 STEP Roundtable Q. 1, 2024-1007861C6 - Spousal Trust and Contribution
In the case of a spousal or common-law partner trust (a “spousal trust”), would a contribution to that trust, made after the death of the...
6 October 2017 APFF Roundtable Q. 14, 2017-0720321C6 F - GAAR & 21-year rule planning
If the terms of a discretionary family trust (“Old Trust”) so permit, the trustees (as the 21st anniversary approaches) could choose to...
10 June 2016 STEP Roundtable Q. 11, 2016-0645821C6 - Tainting of a Spousal Trust
When asked to comment on the statement in IT-305R4, para. 8:
Once a trust qualifies as a spouse trust under the terms of subsection 70(6), it...
28 November 2010 CTF Roundtable, 2013-0487431C6 - Value of Vote-Only Shares 2010 CTF Conference
CRA generally will ignore any premium that could be attributed to controlling non-participating preference shares, for purposes of subsection...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - General Concepts - Fair Market Value - Shares | premium for voting rights | 170 |
| Tax Topics - Income Tax Act - Section 70 - Subsection 70(5) | 170 |
9 May 2007 External T.I. 2006-0189931E5 F - Renonciation à une fiducie par un conjoint
The beneficiary of a testamentary spousal trust renounces all entitlements under the trust (other than income that has accrued to date) without...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 69 - Subsection 69(1) - Paragraph 69(1)(b) | renunciation of interest in spousal trust not a disposition to the family beneficiaries | 84 |
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Disposition | extinguishment of trust interests on their renunciation is a disposition of the renounced interest, but resulting variation of trust to accelerate distribution entitlements is not | 167 |
| Tax Topics - Income Tax Act - Section 70 - Subsection 70(6) | variation of spousal trust, following renunciation by spouse, to accelerate distribution entitlement of residuary beneficiaries would not deny s. 70(6) rollover | 211 |
11 July 2001 External T.I. 2001-0078365 F - APPLICATION DE 75(2) ET 104(4)
What is the deemed day of disposition under s. 104(4) for an inter vivos trust that qualifies as both a "spousal trust" and a "joint spousal or...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 75 - Subsection 75(2) - Paragraph 75(2)(a) - Subparagraph 75(2)(a)(i) | s. 75(2) applies where transferor can receive taxable capital gains distributions | 224 |
Articles
Carmen Thériault, "Alter Ego and Joint Partner Trust", 21 Estates, Trusts & Pensions Journal, p. 345.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 75 - Subsection 75(2) | 0 |
Subparagraph 104(4)(a)(i)
Administrative Policy
Folio S6-F4-C1, "Testamentary Spouse or Common-law Partner Trusts," 3 February 2022
Subsequent variation of trust does not prevent application of s. 104(4) on 21st anniversary
1.68 It is the terms of the trust upon creation that...
Subparagraph 104(4)(a)(ii.1)
Administrative Policy
15 June 2022 STEP Roundtable Q. 2, 2022-0926761C6 - 104(4)(a)(ii.1) Election
Regarding whether a late election under s. 104(4)(a)(ii.1) can be made, CRA indicated that the courts have held that, where an election that is...
15 June 2021 STEP Roundtable Q. 13, 2021-0883051C6 - Paragraph 104(13.4)(a)
If an alter ego trust does not make the s. 104(4)(a)(ii.1) election, it will be subject to a deemed disposition under s. 104(4)(a) at the end of...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(13.4) - Paragraph 104(13.4)(a) | no deemed year end under s. 104(13.4)(a) on settlor’s death if trust has elected under s. 104(4)(a)(ii.1) | 116 |
Paragraph 104(4)(a.2)
Articles
Elie Roth, Tim Youdan, Chris Anderson, Kim Brown, "Taxation of Trusts Resident in Canada", Chapter 3 of Canadian Taxation of Trusts, (Canadian Tax Foundation), 2016.
Example of application (p. 190)
Paragraph 104(4)(a.2)…can apply when a trust borrows money from an income beneficiary and. distributes the...
Paragraph 104(4)(a.3)
Articles
Elie Roth, Tim Youdan, Chris Anderson, Kim Brown, "Taxation of Trusts Resident in Canada", Chapter 3 of Canadian Taxation of Trusts, (Canadian Tax Foundation), 2016.
Purpose (p. 192)
Paragraph 104(4)(a.3) is an anti-avoidance rule…[whose] purpose… is to ensure that a taxpayer cannot use the rollover in...
Paragraph 104(4)(a.4)
Administrative Policy
15 June 2022 STEP Roundtable Q. 7, 2022-0928291C6 - paragraph 88(1)(d.3)
At the time of the death of its settlor and beneficiary (Mr. X), an alter ego trust held a holding company (Xco) with a number of subsidiaries....
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 88 - Subsection 88(1) - Paragraph 88(1)(d.3) | alter ego trust could use s. 88(1)(d.3) for post-mortem bump if trust deed directed the post-mortem transfer of subsidiary’s shares to new parent | 343 |
Paragraph 104(4)(b)
Administrative Policy
Income Tax Mandatory Disclosure Rules Consultation: Sample Notifiable Transactions (Finance Release Webpage), 4 February 2022
The notifiable transactions designated by CRA pursuant to draft s. 237.4(3) with the concurrence of Finance include:
Extending 21-year period...
29 May 2018 STEP Roundtable Q. 2, 2018-0744101C6 - Creation of a Trust
Assume that the will of a deceased person creates a graduated rate estate, and several testamentary trusts for the testator‘s children or...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(5.8) | s. 104(5.8) applied where successive testamentary trusts created | 156 |
2 June 2011 External T.I. 2011-0399501E5 - TCP distributed by N/R trust to N/R beneficiary
A non-resident inter vivos trust distributes its shares of a private Canadian real estate corporation (Canco) in satisfaction of the capital...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 107 - Subsection 107(2) | 97 | |
| Tax Topics - Income Tax Act - Section 116 - Subsection 116(5) | liability of NR trust to withhold on distribution to NR beneficiary in satisfaction of capital interest | 144 |
Subparagraph 104(4)(b)(ii)
Administrative Policy
2023 Ruling 2023-0986521R3 F - 104(4) and Pipeline
A discretionary inter vivos family trust, settled almost 21 years ago, decided that it would distribute only a portion of its preferred shares of...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 84 - Subsection 84(2) | pipeline transfer by inter vivos family trust of preferred shares (stepped-up under s. 104(4)(b)(ii)) to an existing family company for notes | 290 |
5 October 2012 Roundtable, 2012-0453971C6 F - Fiducies successives/disposition 21 ans
Mr. X died on October 20, 1991. Under the will of Mr. X, who died on October 20, 1991, he bequeathed all his property to a Spousal Trust, with the...
4 June 2002 External T.I. 2002-0127515 F - Règles de réalisation de 21 ans
For U.S. tax purposes, the trustees of an Ontario trust (“1984 Trust”) created a new Ontario trust ("1989 Trust") in 1989, with all the...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(5.8) | potential application of GAAR where transfer to a new trust before the effective date of s. 104(5.8) | 72 |
Subsection 104(5.3)
Articles
Edgar, "Deemed Realization of Trust Property: Proposed Amendments to the 21-Year Rule", Estates and Trusts Journal, April 1992, p. 207.
Subsection 104(5.5)
Administrative Policy
September 1992 B.C. Revenue Canada Round Table, Q. 30 (May 1993 Access Letter, p. 228)
S.104(5.5)(b) could have application where an individual is given a nominal absolute interest under a trust or a contingent interest which is...
Tax Professionals Mini Round Table - Vancouver - Q. 30 (March 1993 Access Letter, p. 110)
Discussion of circumstances where s. 104(5.5)(b) may be applied.
25 June 1992 External T.I. 5-921209
S.104(5.5)(a)(ii) would not preclude an individual from being a beneficiary under a trust where the termination of the beneficiary's interest...
Subsection 104(5.6)
Administrative Policy
31 March 1993 T.I. (Tax Window, No. 29, p. 11, ¶2441)
Re situation where one trust is a beneficiary of another.
Subsection 104(5.8) - Trust transfers
Cases
Ozerdinc Family Trust v Gowling, 2017 ONSC 6
It was acknowledged that a tax lawyer had fallen below the relevant standard of care in failing to advise clients that a new family trust which...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - General Concepts - Negligence, Fiduciary Duty and Fault | test of causation of damages from professional negligence is a “but for” test | 357 |
Administrative Policy
2022 Ruling 2022-0937661R3 F - 104(4) and pipeline transaction
A family inter vivos trust for resident beneficiaries (Trust 1) had distributed its common shares of an investment holding company (Holdings) on...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 84 - Subsection 84(2) | pipeline transaction to raise the funds for the application of the CRA s. 104(5.8) GAAR position to an inter vivos trust used to try to avoid the 21-year deemed disposition | 653 |
| Tax Topics - Income Tax Act - Section 245 - Subsection 245(2) | GAAR treated as self-applying | 71 |
29 May 2018 STEP Roundtable Q. 2, 2018-0744101C6 - Creation of a Trust
Most testamentary trusts to arise on the date of death of the testator, so that the 21-year rule generally is computed from that date.
Unusually,...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(4) - Paragraph 104(4)(b) | 21-year rule’s application to testamentary trust is almost always computed from the testator’s date of death | 294 |
13 June 2017 STEP Roundtable Q. 2, 2017-0693321C6 - GAAR and 21-year planning
Does CRA have an update respecting its comments at the 2016 CTF Roundtable, Q.1 respecting a distribution from a discretionary family trust ("Old...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 245 - Subsection 245(4) | abusive distribution of trust property to corporate beneficiary to defer gain for lifetimes of current beneficaries | 204 |
2016 Ruling 2014-0552321R3 F - Trust to trust Transfer
The transfer of all the assets of an existing inter vivos trust (which was approaching its 21st anniversary) to a new inter vivos trust, whose...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Disposition - Paragraph (f) | para. (f) exception applied on transfer from old discretionary inter vivos family trust to new trust with terms considered to be substantively the same | 782 |
| Tax Topics - Income Tax Act - Section 74.4 - Subsection 74.4(4) | having a trust interest vest indefeasibly in a minor is consistent with the minor not receiving or having any use of the trust capital | 468 |
| Tax Topics - Income Tax Act - 101-110 - Section 108 - Subsection 108(1) - Trust - Paragraph (g) | trust holding property on its 21st anniversary for minors was not subject to s. 104(4) as their shares would have been deemed under the Trust Deed to be irrevocably determined by then | 413 |
29 November 2016 CTF Roundtable Q. 1, 2016-0669301C6 - GAAR & 21-year rule planning
A discretionary trust (Old Trust) that is approaching its 21st anniversary distributes property with an unrealized gain to a corporate beneficiary...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 245 - Subsection 245(4) | avoidance of 21-year rule through 107(2) transfer to corporate beneficiary | 138 |
10 June 2013 STEP Roundtable, 2013-0486001C6 - 2013 STEP CRA Roundtable Question 11
The first deemed disposition day of a pre-1972 non-spousal testamentary trust was deferred until January 1, 1999 through an exempt beneficiary...
8 January 2013 External T.I. 2012-0459621E5 - Deemed disposition day on trust-to-trust transfer
A testamentary trust made an exempt beneficiary election under s. 104(5.3) so that its deemed disposition day was deferred until January 1, 1999....
4 June 2002 External T.I. 2002-0127515 F - Règles de réalisation de 21 ans
For U.S. tax purposes, the trustees of an Ontario trust (“1984 Trust”) created a new Ontario trust ("1989 Trust") in 1989, with all the...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(4) - Paragraph 104(4)(b) - Subparagraph 104(4)(b)(ii) | reduction in number of trustees in a purported new trust did not necessarily create a new trust | 96 |
Subsection 104(5.31)
Administrative Policy
16 September 1996 External T.I. 9629565 - REVOCATION OF THE ELECTION FILED UNDER PARA 104(5.3)
Discussion of procedure for revocation of election.
Subsection 104(6) - Deduction in computing income of trust
Cases
Magren Holdings Ltd v. Canada, 2024 FCA 202
In the course of a preliminary review of the scheme of the Act, Monaghan JA stated (at paras. 17-19):
When a trust purchases for cancellation...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 245 - Subsection 245(4) | it is an abuse of the capital gains system to recognize a capital gain increment to a CDA account when there was no net change in economic position | 566 |
| Tax Topics - Income Tax Act - Section 245 - Subsection 245(1) - Tax Benefit | avoidance of Pt. III tax liability was a tax benefit | 529 |
| Tax Topics - Income Tax Act - Section 245 - Subsection 245(2) | it is reasonable to assess a 60% tax under s. 245(2) if that was the quantum of tax whose avoidance represented the tax benefit | 212 |
| Tax Topics - General Concepts - Ownership | RRSP trust transferred the ownership of the income fund units in which it transacted | 325 |
| Tax Topics - General Concepts - Sham | finding of sham must consider what are in fact the real transactions | 50 |
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Disposition - Paragraph (e) | transfer of property by a trust is a disposition unless to an agent | 114 |
See Also
Succession Georges Robillard v. The Queen, 2022 TCC 13
An estate engaged in accelerated pipeline transactions in which it transferred shares (stepped up under s. 70(5)) of a portfolio company...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 84 - Subsection 84(2) | MacDonald established that s. 84(2) applied to a speedo pipeline – but correctness of MacDonald doubted | 377 |
Turcotte v. ARQ, 2015 QCCA 396
An estate received $475,000 from the RRSP of the deceased and paid a legacy bequeathed by the deceased to a charitable foundation of 70% of the...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 118.1 - Subsection 118.1(5) | no s. 104(6) deduction for testamentary gift distributed to charity and deducted under s. 118.1(5) | 73 |
Administrative Policy
3 May 2022 CALU Roundtable Q. 9, 2022-0928891C6 - Subsection 104(6)
Scenarios (a) and (b)
A resident trust receives a deemed dividend under s. 84(3) on a cash redemption of shares of a wholly-owned Canadian...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(24) | payment of distribution does not deem it to have been payable in the year | 68 |
7 October 2021 APFF Financial Strategies and Instruments Roundtable Q. 6, 2021-0896061C6 F - Prolonged Administration of an Estate
When it applies, s. 104(18) deems income of a resident trust to have become payable in a taxation year to a beneficiary under 21 years of age,...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(18) | s. 104(18) can apply where an executor has discretion to defer the payment of income for the benefit of minor beneficiaries over an extended period | 330 |
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(1) | extended administration clause created an extended trust | 154 |
26 November 2020 STEP Roundtable Q. 1, 2020-0839931C6 - Executor's Year of a GRE
After referring to the common-law concept of the executor’s year, IT-286R2, para. 6 states:
In spite of such common law rules, where the initial...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(23) | CRA executor’s year policy is relevant only where the executor’s year extends beyond the GRE’s taxation year | 529 |
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(13.3) | scope of application of s. 104(13.3) | 152 |
14 September 2017 Roundtable, 2017-0703921C6 - 2017 CPA Alberta Q25: Estates – Income Paid or Payable
IT-286R2, para. 6 states that the income of the trust for that year is considered to be payable to the beneficiaries where the sole reason for the...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(24) | IT-286R2 policy on executor’s year extends to a stub executor’s year | 487 |
13 June 2017 STEP Roundtable Q. 10, 2017-0693351C6 - 104(6), (13), (24) and ITTN 11
A father who is the trustee of a discretionary family trust reimburses himself out of the trust funds for itemized expense of restaurant meals of...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(24) | payments by discretionary trust of alleged children's expenses must clearly be for their benefit | 160 |
1 November 2016 Internal T.I. 2016-0663971I7 - 104(6)(b), whether amount became payable
A family trust paid income to the minor children in breach of a prohibition in the trust deed against making distributions to designated...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(24) | income that is paid to a minor beneficiary in contravention of the trust deed is non-deductible under s. 104(6) | 190 |
| Tax Topics - Income Tax Act - 101-110 - Section 105 - Subsection 105(1) | income distributions to minor beneficiaries contrary to trust deed included under s. 105(1) | 151 |
| Tax Topics - General Concepts - Illegality | distribution contrary to trust deed not considered to be payable | 137 |
29 November 2016 CTF Roundtable Q. 14, 2016-0669871C6 - Estate distribution
CRA considers that the residue of the Estate can include income and that such income generally can be made payable to a residual beneficiary, so...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(24) | income may not be payable to beneficiary if estate required to pay taxes thereon | 309 |
10 June 2016 STEP Roundtable Q. 12, 2016-0634921C6 - Phantom Income
As deemed income (e.g., a capital gain deemed to arise under a s. 48.1 election on the IPO of a Canadian-controlled private corporation) is not...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(24) | distributions of phantom income must be authorized and effected under the trust deed | 206 |
10 July 2013 Internal T.I. 2013-0475501I7 F - Amounts returned to trustee/beneficiary
Father and Y were the trustees of a Quebec family trust, whose beneficiaries included father and his three children. Distributions made by the...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(13) | family trust income distributed to children but repaid as reimbursement to father for family expenses was income to him, not them | 221 |
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(24) | distributions to children immediately paid to father | 184 |
| Tax Topics - Income Tax Act - 101-110 - Section 105 - Subsection 105(1) | payment of income distributions by children to father not a benefit under the trust | 230 |
| Tax Topics - Income Tax Act - Section 56 - Subsection 56(4) | payment of distributed family trust income by children to father did not engage s. 56(4) as it was only potential income to him | 175 |
2007 Ruling 2007-0245281R3 - windup of income trust on sale of assets:3rd party
After the acquisition of a mutual fund trust (the "Fund") by Bidco, the Fund sells all its assets, including an interest in a limited partnership,...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 40 - Subsection 40(3.3) | capital loss on redemption of trust units following distribution of most of its assets including as capital gains distribution | 110 |
| Tax Topics - Income Tax Act - Section 53 - Subsection 53(2) - Paragraph 53(2)(h) - Subparagraph 53(2)(h)(i.1) | no ACB reduction for capital gains distribution by unit trust to bidco | 86 |
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(21) | trustees making filings on behalf of terminated fund | 48 |
| Tax Topics - Income Tax Act - Section 20 - Subsection 20(1) - Paragraph 20(1)(c) | assumed debt traceable to capital distribution | 97 |
| Tax Topics - Income Tax Act - Section 80 - Subsection 80(1) | 90 | |
| Tax Topics - Income Tax Act - Section 80 - Subsection 80(5) | 90 |
2007 Ruling 2007-0224201R3 - Unit trust - Capital gain allocation
Trust agreements for mutual fund trusts (the "Funds") are amended to provide that the trustee shall allocate all or a portion of net capital gains...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(7.1) | allocation of capital gains realized on units redemption exclusively to such units | 108 |
30 September 2005 External T.I. 2004-0093661E5 F - Revenu d'une fiducie et droit acquis par un mineur
Can the trustee allocate the taxable portion of a capital gain to an income beneficiary and the non-taxable portion of the capital gain to a...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(24) | written trustee resolution may be necessary to establish that an amount of income has become payable | 202 |
24 June 2003 External T.I. 2003-0000695 - Capital distribution to n/r beneficiary
A resident testamentary trust resident holds shares of a publicly traded corporation (that are not taxable Canadian property) for the benefit of a...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 107 - Subsection 107(2.11) | Pt XIII tax exigible, in absence of election, on distribution to NR of appreciated capital property | 49 |
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(24) | distribution of property with accrued gain treated as distribution of the taxable capital gain thereby realized | 178 |
2003 Ruling 2003-000348D - Mutual Fund Trust - Capital Gain Allocation
The Declaration of Trust of a mutual fund trust is amended to provide that on redemption of units, the unitholders will be paid a proportionate...
26 May 2003 Internal T.I. 2003-0002297 F - Fonds commun de placement-Dépenses gén.
Regarding the allocation of expenses (including fees under s. 20(1)(bb)) by a mutual fund trust (or mutual fund corporation) to its different...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 20 - Subsection 20(1) - Paragraph 20(1)(bb) | s. 20(1)(bb) deductibility does not turn on the evaluated security being acquired | 158 |
2002 Ruling 2001-009107A - Mutual Fund Trust-Capital Gains
The trust agreement respecting a mutual fund trust is amended to provide that where units of the fund are redeemed, a portion of the redemption...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 132 - Subsection 132(4) - Capital Gains Redemption | A of formula to redeemed unitholder reduced by any amount of allocated capital gains | 146 |
30 November 1996 Ruling 9711283 - DEDUCTIBILITY OF 94.1 INCOME TO A MUTUAL FUND TRUST
Income arising under s. 94.1 to a Canadian resident trust may be deducted under s. 104(6) if, under the trust indenture, the amount in question is...
12 December 1996 External T.I. 9629345 - DSG'N OF A REALIZED TCG TO BENEFICIARIES WHEN PAID
Where preferred shares are distributed, the amount of the distribution will be the fair market value of the preferred shares.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(21) | allocation of capital gain realized on distribution | 62 |
IT-381R2 "Trusts - Deduction of Amounts Paid or Payable to Beneficiaries and Flow-Through of Taxable Capital Gains to Beneficiaries" under "Double Taxation Relief"
2. As a general rule, amounts included in the income of a trust's beneficiary under subsections 104(13), 104(14) or 105(2) (described in ¶s 1(a)...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 108 - Subsection 108(1) - Testamentary Trust | 20 | |
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(21.2) | 0 |
Articles
M. Elena Hoffstein, Corina S. Weigl, "Overview of the Twenty One Year Rule—A Trust Lawyer's Perspective", 2014 Ontario Tax Conference (Canadian Tax Foundation)
Duty to act impartially between income and capital beneficiaries
- The duty to act impartially requires that receipts coming into the trust be...
Elie Roth, Tim Youdan, Chris Anderson, Kim Brown, "Taxation of Trusts Resident in Canada", Chapter 3 of Canadian Taxation of Trusts, (Canadian Tax Foundation), 2016.
Deduction in executor’s year or of formula amount (p. 203)
[S]ubsection 104(6) can potentially apply to amounts paid or payable from an estate. ...
Gabrielle Richards, "Executor's Year", Canadian Current Tax, October 1987, p. J49
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(24) | 0 |
Paragraph 104(6)(b)
See Also
Fiducie Historia v. The King, 2024 TCC 76
A discretionary family trust, whose beneficiaries included the family patriarch (LR) and his two sons (the Rémillard Brothers), was a shareholder...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - General Concepts - Illegality | Minister did not have standing regarding a challenge to a transaction that is voidable for illegality rather than void – although such illegality was not made out on the facts | 435 |
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(24) | amounts that in fact had been paid were not deemed to have been payable notwithstanding any illegality | 152 |
Administrative Policy
4 June 2024 STEP Roundtable Q. 10, 2024-1010241C6 - Update on trust / estate issues
CRA referred to an unreported 2023 Tax Court of Canada decision (which has not been appealed), which concerned a family trust that realized a...
18 April 2019 External T.I. 2017-0716451E5 F - Deduction in computing income of a trust
A discretionary family trust realized a taxable capital gain of $200,000, as well as a rental loss from a building of $100,000, with no other...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 105 - Subsection 105(1) | a distribution by a discretionary trust of a taxable capital gain in excess of the trust’s income could be a s. 105(1) benefit | 152 |
14 February 2013 Internal T.I. 2011-0424341I7 F - Amounts forwarded to trustee/beneficiary
The financial advisor of Mother settled a discretionary trust of which Mother and her friend (Y) were the trustees (with decisions to be made...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 75 - Subsection 75(2) | s. 75(2) not applicable to dividends on common shares issued to discretionary family trust on estate freeze | 237 |
| Tax Topics - Income Tax Act - Section 56 - Subsection 56(2) | s. 56(2) did not apply to trustee/beneficiary of discretionary trust who directed income to her children and did not exercise discretion in her own favour | 218 |
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(13) | income was received by children beneficiaries as agent for their mother | 263 |
30 September 2009 External T.I. 2009-0317641E5 F - Attribution de revenu
Participating shares of Opco were issued to a discretionary trust ("Trust") as part of an estate freeze, and Opco then paid a dividend to the...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 75 - Subsection 75(2) | issuance of shares at FMV is not a transfer of property to which s. 75(2) can apply | 179 |
Element B
Subparagraph (i)
Administrative Policy
29 May 2018 STEP Roundtable Q. 11, 2018-0748241C6 - Subsection 104(13.4)
For taxation years ending after 2015, where the lifetime beneficiary of an alter ego trust dies, the trust will have a deemed year end on the...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 75 - Subsection 75(2) | s. 75(2) does not apply to the deemed s. 104(4) capital gain arising in an alter ego trust on the life beneficiary’s death | 146 |
2 May 2018 External T.I. 2017-0717831E5 - Alter ego trust in year of beneficiary's death
An alter ego trust receives the dividend income which became payable to the lifetime beneficiary (primary beneficiary) in the post-2015 year of...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(13.4) - Paragraph 104(13.4)(b) | distributed ordinary income earned in shortened year is deductible | 94 |
Subsection 104(7.01) - Trusts deemed to be resident in Canada
Administrative Policy
25 July 2014 Internal T.I. 2013-0513641I7 - Deemed resident trust under subsection 94(3)
The Estate of a Canadian resident, with two of his children as (apparently non-resident) beneficiaries (A and B), was not resident in Canada by...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 120 - Subsection 120(1) | addition for s. 94 deemed trust | 154 |
| Tax Topics - Income Tax Act - Section 94 - Subsection 94(3) - Paragraph 94(3)(g) | required Part XIII withholding treated like Part I instalment | 151 |
Articles
Mark Brender, Marc Roy, "Canadian Tax Trap Arising from Cross-Border Gift Tax Planning", Tax Notes International, Vol. 111, 4 September 2023, p. 1217
FTC mismatch as a result of application of s. 104(7.01) (p. 1220)
- Where a non-grantor trust that is subject to s. 94 makes a distribution to a...
Elie Roth, Tim Youdan, Chris Anderson, Kim Brown, "Taxation of Trusts Resident in Canada", Chapter 3 of Canadian Taxation of Trusts, (Canadian Tax Foundation), 2016.
Effect of specified factor (p. 208)
Subsection 104(7.01) limits the amount of the deduction under subsection 104(6) for distributions of...
Subsection 104(7.1) - Capital interest greater than income interest
Administrative Policy
2015 Ruling 2015-0578051R3 - Variation of trust indenture
The Declaration of Trust of the Fund, which is a listed closed-end mutual fund trust (with one class of units) not holding non-portfolio property,...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Disposition | addition of preferred units not disposition | 42 |
2014 Ruling 2014-0518521R3 - Issuance of a new class of units - Hedged Class
An open-end mutual fund trust ("Fund 1") investing in senior floating rate and lower-rate loans around the world will add a class of units (the...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Disposition | addition of FX-hedged units not a disposition for existing unitholders/ reclassification of hedged to unhedged units likely would entail a disposition | 212 |
2012 Ruling 2011-0429611R3 - Variation of Trust Indenture
An open end (as described in s. 108(2)(a)) mutual fund trust (the Trust), whose units (the Units) trade on an exchange, wishes to qualify as a...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 108 - Subsection 108(2) - Paragraph 108(2)(b) | application of asset tests to sub LPs on look-through basis; special voting unit | 363 |
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Disposition | addition of preferred REIT units not disposition/ exercise of right to redesignate fixed preferred units as floating rate, is disposition | 305 |
2012 Ruling 2011-0410181R3 - Variation of trust indenture
An open end (as described in s. 108(2)(a)) mutual fund trust (the Trust), whose units (the Units) trade on a stapled basis with a second open-end...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 108 - Subsection 108(2) - Paragraph 108(2)(b) | conversion of note to satisfy 10% test/partnership look-through | 291 |
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Disposition | addition of preferred units | 210 |
12 October 2012 External T.I. 2012-0448351E5 - treatment of trailer fee rebates
A mutual fund trust pays commissions ("DSC Commissions") to the dealer through whom its units were purchased and also pays an annual trailer fee. ...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(13) | MFT fee rebate | 195 |
| Tax Topics - Income Tax Act - Section 12 - Subsection 12(2.1) | no s. 12(2.1) inclusion if MFT fee rebate paid directly to large investor as trust distribution | 195 |
2011 Ruling 2010-0389921R3 - New series of units - US dollar and Hedged
In order to permit some unitholders (who have US dollars to invest) to achieve a return in US dollars that is the same as the Canadian market...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Disposition | redesignation of single series of MFT units to be Cdn$ or USD hedged units, not a disposition | 211 |
2010 Ruling 2010-0361771R3 - Variation of trust indenture
A closed-end mutual fund trust intends to qualify as a REIT. The beneficial interests in the trust currently consist of only one class of units...
2007 Ruling 2007-0224201R3 - Unit trust - Capital gain allocation
Trust agreements are amended to provide that the trustee shall allocate all or a portion of net capital gains realized by the trust in the year to...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(6) | gains realized in the year allocated to units redeemed at any time in the year up to amount of outside accrued gain thereon | 300 |
2004 Ruling 2004-0074311R3 - Income Trust
Members of the public subscribe for Class A redeemable units of a mutual fund trust (the "Fund"). A holding corporation for a vendor group...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 108 - Subsection 108(2) - Paragraph 108(2)(a) | Class B units redeemable (at X% of market average or current market) for notes of sub subject to potential price adjustment | 218 |
2001 Ruling 2001-0108473 - XXXXXXXXXX INTEREST DEDUCTIBILITY
A unit trust whose purpose was to raise financing for a corporation has one class of units that are held by the public and another class of units...
2000 Ruling 2000-0041363 - Allocation of Gains to Redeeming Unitholders
Rulings that, where the trust deeds for mutual funds are amended to provide that, realized capital gains will be allocated first to units that...
2000 Ruling 2000-0008363 - Mutual Fund Large Investor Incentive
S. 104(7.1) ruling given regarding the discontinuance of the large investor rebate program (under which income of the Trust is first computed and...
ATR-65 CANCELLED 20 April 1995
The management agreements between open end mutual fund trusts (the "Funds") and their "Manager" will be amended to provide that the Manager may...
Articles
Josh Jones, Jeffrey Love, "Recent Developments in Asset Management", draft 2023 CTF Annual Conference paper
Purpose test applies at time the terms are established (p. 10)
- The original Explanatory Notes referenced “one of the main purposes for the...
Carrie Smit, "Recent Transactions of Interest", 2011 Canadian Tax Foundation Conference Report, C. 10
In early 2011 RioCan successfully completed the issuance of 5 million series A units for gross proceeds of $125 million. …
Subsection 104(7.1),...
Botz, "Mutual Fund Trusts and Unit Trusts: Selected Tax and Legal Issues", 1994 Canadian Tax Journal, Vol. 42, No. 4, p. 1037.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 108 - Subsection 108(2) - Paragraph 108(2)(a) | 0 | |
| Tax Topics - Income Tax Act - Section 52 - Subsection 52(6) | 0 |
Goodman, "The Tax Treatment of Commercial Trusts", 1989 Canadian Tax Journal, July-August issue, p. 1053
Subsection 104(8)
Cases
Re Liberal Petroleums Trust (1985), 21 E.T.R. 90 (Alta.Q.B.)
Income taxes were paid by a unit trust as a consequence of s. 104(8). Since the trust deed required the trustee to pay the taxes imposed on the...
Subsection 104(13) - Income of beneficiary
Cases
Marino v. Canada, 2022 FCA 115
An individual with no connection to Canada paid significant tuition fees while in attendance at U.S. universities prior to 2012 then, on...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Taxation Year | Oceanspan principle indicates that a non-resident who does not compute income from any source for ITA purposes does not have a taxation year | 264 |
| Tax Topics - Income Tax Act - Section 250.1 - Paragraph 250.1(a) | s. 250.1(a) did not supersede Oceanspan principle | 256 |
Laplante v. Canada, 2018 FCA 193
The taxpayer (Laplante) was the dominant trustee of a family trust (DL Trust) that had realized a capital gain of around $6M on the sale of...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - General Concepts - Sham | a purported distribution of QSBCS gains to family trust beneficiaries was a sham | 462 |
Brown v. The Queen, 79 DTC 5421, [1979] CTC 476 (FCTD)
If a trust does not deduct pursuant to s. 104(6) an amount payable to its beneficiary, that amount is nevertheless taxable in the hands of the...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - General Concepts - Estoppel | 80 | |
| Tax Topics - Income Tax Act - Section 152 - Subsection 152(1) | 46 | |
| Tax Topics - Statutory Interpretation - Interpretation Bulletins, etc. | 47 |
See Also
Caplan v. Agence du revenu du Québec, 2019 QCCQ 3269
The taxpayer and his wife were the trustees of a discretionary family trust having him, their two (university-age) children (Michael and Megan)...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(24) | income distributions to children were received by them on behalf of father | 155 |
Lewski v Commissioner of Taxation, [2017] FCAFC 145
On June 30, 2006, the trustee of an Australian trust declared a distribution to the taxpayer of all its income for the year then ended and at the...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(a) - Incurring of Expense | obligation to pay purchase price was incurred on agreement date rather than subsequent closing | 430 |
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(24) | an alternate resolution that the taxpayer was not entitled to an income distribution if Revenue denied a trust deduction made her entitlement contingent and non-includible | 374 |
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(8) - Paragraph 248(8)(b) | since the taxpayer through her husband as agent had knowledge of an income distribution, her subsequent purported disclaimer was not immediate | 304 |
| Tax Topics - General Concepts - Agency | knowledge of agent imputed to principal | 217 |
Pope & Ors v. R & C Commrs., [2012] UKUT 206 (Tax and Chancery Chamber)
The son of the taxpayer, who was the beneficiary of his own life insurance policy, likely died in 1998 when he was abducted by Angolan rebels, but...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 12 - Subsection 12(1) - Paragraph 12(1)(c) | 312 |
Gros v. The Queen, 2012 DTC 1110 [at at 3059], 2012 TCC 14 (Informal Procedure)
The taxpayer held units of a listed mutual fund trust (Fording Canadian Coal Trust), which disposed of all its assets to Teck Cominco Ltd. in a...
Joseph v. The Queen, 2010 DTC 1229 [at at 3649], 2010 TCC 350 (Informal Procedure)
A unit trust ("Fording") of which the taxpayer was a unitholder agreed to a cash and stock takeover bid from Teck Cominco, as a result of which...
Administrative Policy
22 June 2023 External T.I. 2018-0746741E5 F - Eligible dividend allocation
A discretionary trust received an eligible dividend in a year and immediately allocated and distributed it to a beneficiary; and later in the same...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(19) | eligible and non-eligible dividend can be wholly designated to two respective beneficiaries | 180 |
26 November 2020 STEP Roundtable Q. 11, 2020-0839891C6 - Subsection 104(19)
If a beneficiary receives an amount to be designated under s. 104(19) as a taxable dividend (which CRA noted would be effective only on December...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 186 - Subsection 186(1) - Paragraph 186(1)(a) | Pt IV tax exemption no longer available because corporate beneficiary was no longer connected at December 31 effective time of s. 104(19) designation | 196 |
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(19) | dividend subject to Pt IV tax because payer and corporate beneficiary no longer connected at December 31 effective date of all s. 104(19) designations | 85 |
| Tax Topics - Income Tax Act - Section 249 - Subsection 249(1) - Paragraph 249(1)(c) | individual has a calendar year, even in terminal year | 149 |
7 June 2019 STEP Roundtable Q. 11, 2019-0805771C6 - Estate as Qualified Disability Trust
An estate that qualified as a graduated rate estate (GRE) was not able to convert some of the estate property into cash until late in the third...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 122 - Subsection 122(3) - qualified disability trust - Paragraph (a) - Subparagraph (a)(i) | a GRE likely cannot be continued indefinitely as a QDT | 218 |
8 June 2018 Internal T.I. 2017-0683021I7 - Assignment of capital interest in a trust
A discretionary irrevocable personal family trust (the “Trust”), had non-resident beneficiaries (“Y” and “Z”) and held common shares...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 107 - Subsection 107(5) | purported drop down of trust interests by non-resident beneficiaries to ULC was ineffective so that s. 107(2.1) applied to subsequent purported asset distribution to ULC | 192 |
| Tax Topics - Income Tax Act - Section 56 - Subsection 56(2) | potential application of s. 56(2) to income distribution to non-qualifying transferee of trust interest | 203 |
| Tax Topics - Income Tax Act - 101-110 - Section 105 - Subsection 105(1) | potential application of s. 105(1) to income distribution to non-qualifying transferee of trust interest | 273 |
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(25) - Paragraph 248(25)(a) | para. (a) refers to beneficiary in ordinary sense - and does not include assignee | 62 |
24 June 2015 External T.I. 2015-0565951E5 F - Legatee by particular
Is a legatee by particular title (i.e., the recipient of a specific bequest, even if not an heir by virtue of the Civil Code of Quebec ("CCQ")) a...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 108 - Subsection 108(1) - Beneficiary | legatee by particular title is a beneficiary even if not an heir | 72 |
2015 Ruling 2015-0570291R3 - Foreign tax credit on income from a trust
As a result of the death of an individual who had previously become resident in the U.S. (the "Settlor"), and who was the sole contributor to a...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 126 - Subsection 126(7) - Non-Business-Income Tax | withholding on IRA proceeds | 65 |
16 June 2014 STEP Roundtable, 2014-0523001C6 - Trusts structured to invoke 75(2)
An "evil trust" is structured to deliberately cause the application of subsection 75(2), so as to cause the attribution of dividend income to a...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 75 - Subsection 75(2) | Brent Kern schemes don't work even if Sommerer issue fixed | 423 |
11 October 2013 APFF Roundtable, 2013-0495651C6 F - Revenu fractionné
A discretionary family trust with Father, Mother and a 15-year old Child as beneficiaries, holds a building with two premises – the first leased...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 120.4 - Subsection 120.4(1) - Split Income - Paragraph (c) | streaming of non-split income to child discretionary beneficiary and split income to mother | 213 |
10 July 2013 Internal T.I. 2013-0475501I7 F - Amounts returned to trustee/beneficiary
Father and Y were the trustees of a Quebec family trust, whose beneficiaries included father and his three children. Distributions made by the...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(24) | distributions to children immediately paid to father | 184 |
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(6) | distributions to children immediately paid to father were deductible even though received by children as his agents | 179 |
| Tax Topics - Income Tax Act - 101-110 - Section 105 - Subsection 105(1) | payment of income distributions by children to father not a benefit under the trust | 230 |
| Tax Topics - Income Tax Act - Section 56 - Subsection 56(4) | payment of distributed family trust income by children to father did not engage s. 56(4) as it was only potential income to him | 175 |
14 February 2013 Internal T.I. 2011-0424341I7 F - Amounts forwarded to trustee/beneficiary
The financial advisor of Mother settled a discretionary trust of which Mother and her friend (Y) were the trustees (with decisions to be made...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 75 - Subsection 75(2) | s. 75(2) not applicable to dividends on common shares issued to discretionary family trust on estate freeze | 237 |
| Tax Topics - Income Tax Act - Section 56 - Subsection 56(2) | s. 56(2) did not apply to trustee/beneficiary of discretionary trust who directed income to her children and did not exercise discretion in her own favour | 218 |
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(6) - Paragraph 104(6)(b) | Quebec discretionary trust with two named trustees but, in fact, only one trustee, would not be entitled to s. 104(6)(b) deductions | 155 |
16 October 2012 External T.I. 2012-0459061E5 - Reimbursement of Management Fee
A mutual fund trust pays a base level of managament fees to a fund manager, but pays a reduced effective rate in respect of unitholders with large...
12 October 2012 External T.I. 2012-0448351E5 - treatment of trailer fee rebates
A mutual fund trust pays commissions to the dealer through whom its units were purchased and also pays an annual trailer fee. However, the dealer...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(7.1) | MFT fee rebate paid directly to large investor as trust distribution | 263 |
| Tax Topics - Income Tax Act - Section 12 - Subsection 12(2.1) | no s. 12(2.1) inclusion if MFT fee rebate paid directly to large investor as trust distribution | 195 |
2 October 2012 External T.I. 2012-0448021E5 - Distribution by a non-resident trust
Given that "[p]aragraph 250.1(b) of the Act generally provides that where income is to be determined under the Act for a non-resident person, it...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 250.1 - Paragraph 250.1(b) | only 1/2 of capital gains of NR trust included in income | 66 |
2012 Ruling 2012-0456221R3 - Post Mortem Planning
A spousal testamentary trust held the shares (being common shares) of a Canadian investment holding company (Holdco) on the death of the surviving...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 69 - Subsection 69(5) | shares of Holdco, stepped up to trust under s. 104(4)(a)(iii), are transferred to a Newco 2, and Newco 2 is wound-up under s. 69(5) to realize a capital loss, with s. 84(2) deemed dividend allocated to US trust beneficiaries | 1016 |
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Disposition - Paragraph (b) - Subparagraph (b)(i) | disposition on s. 69(5) wind-up occurred at time of winding-up rather than subsequent filing of articles of dissolution | 73 |
10 August 2012 External T.I. 2012-0453041E5 - Income recognition-mutual fund beneficiary
A spousal testamentary trust with a March 31, 2013 taxation year end would include income, that became payable to it in January to March 2012 by a...
5 July 2012 Internal T.I. 2010-0388551I7 F - Fiducie - retour de sommes
A family trust whose beneficiaries included Father, Mother, two sons (Son A and Son B) and the wife of Son A (Daughter-in-law A) but not the wife...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 75 - Subsection 75(2) | s. 75(2) does not apply to an estate freeze as the corp does not own its treasury shares issued to the trust | 164 |
| Tax Topics - Income Tax Act - 101-110 - Section 105 - Subsection 105(1) | income distributed to daughter-in-law who in fact was not a beneficiary includible in her income under s. 105(1) but not deductible by trust under s. 104(6) | 166 |
| Tax Topics - Income Tax Act - 101-110 - Section 110.6 - Subsection 110.6(6) | Foisy test of mental element accepted | 238 |
21 June 2004 STEP Roundtable Q. 3, 2004-0069951C6 - Phantom Income
While a trust's income is determined in accordance with the Act, the amount payable to the beneficiary is determined in accordance with the trust...
18 May 2004 External T.I. 2002-0168191E5 F - Somme reçue après la fin d'une succession
After an estate was settled and closed, it unexpectedly received an amount from the pension plan of the deceased, representing a refund of excess...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 56 - Subsection 56(1) - Paragraph 56(1)(a) - Subparagraph 56(1)(a)(i) | pension payment received after estate termination was included in beneficiaries’ income pursuant to s. 56(1)(a) rather than s. 104(13) | 163 |
28 July 2003 Internal T.I. 2003-0013677 - Capital Distribution by a Non-resident Trust
The corporate trustee of a non-resident trust, which under the trust terms was accorded the discretion to distribute trust capital or income to...
6 June 2003 Internal T.I. 2003-0183437 - Distributions from non-res trust
An individual who was a non-resident capital and income beneficiary of a discretionary non-resident trust made a loan to the trust, and then...
24 March 1994 External T.I. 9402855 - DISTRIBUTIONS FROM FOREIGN TRUSTS
In the course of a general response, CRA stated (in the context of the pre-2001 version of s. 104(13)):
Dividends received from a non-resident...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 90 - Subsection 90(1) | 52 |
IT-85R2 "Health and Welfare Trusts for Employees"
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 6 - Subsection 6(1) - Paragraph 6(1)(a) | 0 |
Articles
Elie Roth, Tim Youdan, Chris Anderson, Kim Brown, "Taxation of Beneficiaries Resident in Canada", Chapter 4 of Canadian Taxation of Trusts (Canadian Tax Foundation), 2016.
Distribution of gain by distribution of related property (p. 312)
[T]he CRA expressed the view that in the absence of any evidence of an intention...
Elie Roth, Tim Youdan, Chris Anderson, Kim Brown, "Taxation of Trusts Resident in Canada", Chapter 3 of Canadian Taxation of Trusts, (Canadian Tax Foundation), 2016.
Net capital losses generally carried forward rather than back (pp. 216-7)
The amount included in a beneficiary's income under subsection 104(13)...
Bowman, "Sophisticated Estate-Planning Techniques: Cross-Border Dimensions", 1993 Conference Report, pp. 38-20-21:
Comparison of the taxation of resident trusts under s. 104(13)(a) and non-resident trusts under s. 104(13)(c).
Subsection 104(13.1) - Amounts deemed not paid
See Also
Lussier v. The Queen, 2000 DTC 1677 (TCC)
After retaining a new accountant, an estate sent a letter in November 1994 amending its returns for 1992 and 1993 to make designations under s....
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 150 - Subsection 150(1) - Paragraph 150(1)(c) | late designation by letter was valid return amendment | 88 |
Administrative Policy
19 September 2015 STEP Roundtable, Q.5
Does s. 104(13.3) establish that designations under s. 104(13.1) or (13.2) can only be made so as to apply non-capital or capital losses of other...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(13.2) | late s. 104(13.2) designation to utilize capital loss carryback | 79 |
IT-342R "Trusts-Income Payable to Beneficiaries"
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(13.2) | 0 | |
| Tax Topics - Income Tax Act - Section 210.2 - Subsection 210.2(1) | 0 |
8 October 2010 Roundtable, 2010-0371921C6 F - RPA et RPDB - Montants versés à une succession
In the course of a general discussion of the availability of s. 104(13.1) where an estate received an amount out of a registered pension plan, CRA...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Regulations - Regulation 103 - Subsection 103(4) | lump sum paid out of RPP to estate for adult children is subject to withholding for account of estate | 320 |
25 March 2009 External T.I. 2008-0300401E5 F - Fiducie en faveur de soi-même - prêt sans intérêt
If s. 75(2) were to apply respecting an alter ego trust, could the s. 104(13.1) election be made to tax the income within the trust? CRA...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 75 - Subsection 75(2) | Howson applied to find that non-interest bearing loan by individual to his alter ego trust not subject to s. 75(2)/no contribution if individual pays trust taxes following a s. 104(13.1) election | 181 |
| Tax Topics - Income Tax Act - Section 56 - Subsection 56(4.1) | s. 56(4.1) inapplicable to NIB loan made by individual to his alter ego trust | 139 |
| Tax Topics - General Concepts - Payment & Receipt | individual pays trust taxes when he receives trust distributions net of such taxes | 34 |
13 May 1998 External T.I. 9718325 - 104(13.1) & 104(18)
"Subsection 104(13.1) permits a trust to deduct less than the full amount of its income payable to a beneficiary and thus choose to have that...
15 January 1998 External T.I. 9729215 - DESIGNATION OF DIFFERENT AMOUNTS UNDER 104(13.1)
S.104(13.1) permits different amounts to be designated for each beneficiary, but only to the maximum amount determined by formula. This is...
7 March 1996 External T.I. 9606785 - amount designated 104(13.1) withholding tax 212(1)(C)
Where a designation has been made under s. 104(13.1) in respect of an amount payable to the beneficiary, that amount is considered not to have...
8 April 1993 Income Tax Severed Letter 9236345 - Spousal Trust and Subsection 104(13.1) Designation
Where a spouse is entitled to receive all the income of a testamentary spousal trust but revokes in writing his or her right to receive such...
19 September 1991 Internal T.I. 7-912069
In response to a suggestion that "if no amount is paid to the beneficiaries, no 104(13.1) designation would be possible because the formula would...
2 May 1995 External T.I. 9501395 - SPOUSAL TRUST - SUBSECTION 104(13.1)
"Where a trust is a spousal trust the designation under subsection 104(13.1) ... would not in and by itself, disqualify the trust as a spousal...
25 April 1990 Memorandum (September 1990 Access Letter, ¶1427)
There is nothing in s. 104(13.1) to restrict trusts and estates utilizing that provision to enjoy the use of lower marginal tax rates applicable...
19 April 1990 T.I. (September 1990 Access Letter, ¶1426)
In a situation where a trust has two equal beneficiaries who share income equally, and of the trust income of $10,000, the trust has deducted...
7 December 1989 T.I. (May 1990 Access Letter, ¶1225)
Discussion of various consequences where a beneficiary makes a payment to the trustee to enable the trustee to pay the tax liability of a trust...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 108 - Subsection 108(1) - Testamentary Trust | 58 | |
| Tax Topics - Income Tax Act - Section 70 - Subsection 70(6) | 53 |
Subsection 104(13.2) - Idem [Amounts deemed not paid]
Administrative Policy
10 June 2016 STEP Roundtable Q. 5, 2016-0634901C6 - Subsection 104(13.3)
A trust carries back an allowable capital loss realized in a subsequent year and files a late s. 104(13.2) designation to include in its income a...
19 September 2015 STEP Roundtable, Q. 6(a)
Can a taxable capital gain which is deemed to be payable to an individual (causing a deemed disposition) under s. 104(13.4)(b)(i) be offset...
19 September 2015 STEP Roundtable, Q.5
CRA accepts that if a trust has pushed out income to its beneficiaries in Year 1 and in, say, Year 3, realizes a non-capital or capital loss, it...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(13.1) | late s. 104(13.1) designation to utilize loss carryback | 201 |
IT-342R "Trusts-Income Payable to Beneficiaries"
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(13.1) | 0 | |
| Tax Topics - Income Tax Act - Section 210.2 - Subsection 210.2(1) | 0 |
Subsection 104(13.3)
Administrative Policy
26 November 2020 STEP Roundtable Q. 1, 2020-0839931C6 - Executor's Year of a GRE
In the course of a general discussion of when a graduated rate estate might be subject to tax on income that was not considered to be payable in...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(23) | CRA executor’s year policy is relevant only where the executor’s year extends beyond the GRE’s taxation year | 529 |
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(6) | elaboration of executor's year policy | 477 |
25 July 2016 External T.I. 2016-0630781E5 - 104(13.3) and a CPP/QPP death benefit
After confirming that, by virtue of the new s. 104(13.3), “the option to include [a] CPP/QPP death benefit in income on a T3 return will no...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(24) | executor's year would not preclude a CPP death benefit from being payable to the beneficiaries in the year | 251 |
Articles
Gary I. Biasini, "The Trust is Dead, Long Live The Trust", Tax Topics (Wolters Kluwer CCH), Number 2227, November 13, 2014, p. 1.
Use of s. 104(13.1) designation to shift income to Alberta trust (p.4)
Consider a situation where a husband and wife (each Manitoba residents and...
Subsection 104(13.4)
Articles
Dane ZoBell, "Spousal Trusts Have Limited CGD Access", Canadian Tax Focus (Canadian Tax Foundation), Vol. 8, No. 1, February 2018, p. 15
Use of a spousal trust now precludes use of the spouse’s capital gains deduction for trust property (p.15)
Two suggested drawbacks of using a...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(21.2) | 138 |
Paragraph 104(13.4)(a)
Administrative Policy
15 June 2021 STEP Roundtable Q. 13, 2021-0883051C6 - Paragraph 104(13.4)(a)
Does a deemed year end occur pursuant to s. 104(13.4)(a) where a trust that would otherwise be an alter ego trust makes an election under s....
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(4) - Paragraph 104(4)(a) - Subparagraph 104(4)(a)(ii.1) | overall effect of making the election under s. 104(4)(a)(ii.1) | 105 |
Paragraph 104(13.4)(b)
Administrative Policy
16 August 2019 External T.I. 2018-0742431E5 - Election under 104(13.4)
The surviving spouse beneficiary of a spousal trust died in 2017. All of the conditions in s. 104(13.4)(b.1) for making the joint s. 104(13.4)(b)...
2 May 2018 External T.I. 2017-0717831E5 - Alter ego trust in year of beneficiary's death
S. (i)(B)(I) of Element B in the formula in s. 104(6) ensures that no deduction is available to the an alter ego for any amount included in the...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(6) - Paragraph 104(6)(b) - Element B - Subparagraph (i) | alter ego trust is entitled to a deduction for ordinary income distributions in the year of death | 211 |
19 September 2015 STEP Roundtable, Q.6(b)
How does trust income - deemed under s. 104(13.4)(b)(i) to be payable to the individual - become his or her income given that the individual is...
Finance
Paragraph 104(13.4)(b.1)
Administrative Policy
Folio S6-F4-C1, "Testamentary Spouse or Common-law Partner Trusts," 3 February 2022
Election to report s. 104(4) et seq. income on terminal return
1.69 Paragraph 104(13.4)(b.1), permits the trust and the legal representative...
Paragraph 104(13.4)(c)
Administrative Policy
26 November 2020 STEP Roundtable Q. 2, 2020-0840001C6 - Subsection 104(13.4) and LCBs
If the death of the settlor of an alter ego trust, or the death of the survivor of spouses for a joint spousal trust occurred on July 31, that...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 161 - Subsection 161(1) | s. 104(13.4)(c) extension of balance-due date for terminal stub year of alter ego/joint spousal trust can permit capital loss in subsequent stub year to eliminate terminal year interest | 271 |
Subparagraph 104(13.4)(c)(i)
Administrative Policy
3 December 2019 CTF Roundtable Q. 15, 2019-0824501C6 - Subsection 104(13.4) and LCBs
Life interest trusts, such as alter ego trusts and joint spousal trusts, are deemed under s. 104(4)(a) to have a deemed year end on the date of...
Subsection 104(14) - Election by trust and preferred beneficiary
Cases
Sachs v. The Queen, 80 DTC 6291, [1980] CTC 358 (FCA)
Where preferred beneficiary elections have been made jointly by a trust and the children of the settlor there has "been an exercise of the...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 74.1 - Subsection 74.1(2) | 164 |
Administrative Policy
6 July 2018 External T.I. 2018-0759521E5 - Tax on split income & preferred beneficiary
The definition of split income includes trust income distributions under s. 104(13) but not preferred beneficiary amounts under s. 104(14). ...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 120.4 - Subsection 120.4(1) - Split Income - Paragraph (c) | income to preferred beneficiary is not split income | 107 |
10 June 2016 STEP Roundtable Q. 4, 2016-0645801C6 - QDT & pref beneficiary election
Each of four grandparents of a disabled grandchild establishes a trust for the grandchild individual under their will, with one of the trusts...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 122 - Subsection 122(3) - qualified disability trust | preferred beneficiary and QDT elections not mutually exclusive | 80 |
87 C.R. - Q.9
It may be possible for capital beneficiaries who are not otherwise entitled to share in the income of the trust to elect in respect of trust...
87 C.R. - Q.10
A distribution to a beneficiary other than the beneficiary who elected will not necessarily render the election invalid.
IT-394R "Preferred Beneficiary Election"
Subsection 104(15) - Allocable amount for preferred beneficiary
Paragraph 104(15)(b)
Administrative Policy
24 July 1992 External T.I. 5-921590
A clause in the trust deed allowing the trust deed to encroach upon capital in favour of one or more of the beneficiaries constitutes a...
87 C.R. - Q.11
The phrase "to share equally in any income of the trust" is not interpreted to mean "to share equally in the accumulating income of the trust."
84 C.R. - Q.33
An alternate beneficiary who has succeeded to the income rights of a deceased discretionary beneficiary will be considered to be a discretionary...
Paragraph 104(15)(d)
Administrative Policy
86 C.R. - Q.55
A trust may not allocate CCA to a beneficiary that is greater than his income from the trust.
Subsection 104(18) - Trust for minor
Administrative Policy
7 October 2021 APFF Financial Strategies and Instruments Roundtable Q. 6, 2021-0896061C6 F - Prolonged Administration of an Estate
The will of Mr. X, a resident of Quebec, left all of his property in equal shares to his two children, aged 10 and 15. His will included an...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(1) | extended administration clause created an extended trust | 154 |
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(6) | s. 104(18) overrode the s. 104(6) requirement to make income payable in the year | 295 |
19 February 2014 External T.I. 2013-0500561E5 F - Payment to a subtrust for minor
The beneficiaries of a family discretionary trust are secondary trusts each of which has an infant beneficiary. The income of a secondary trust is...
13 June 1995 Internal T.I. 9514227 - PAYMENT INTO COURT BY AN ESTATE FOR DECEASED'S CHILDREN SECTION 104(24)
Where pension income received by an estate is paid pursuant to a court order into the court for the benefit of the deceased's minor children, s....
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(24) | 62 |
Articles
Elie Roth, Tim Youdan, Chris Anderson, Kim Brown, "Taxation of Trusts Resident in Canada", Chapter 3 of Canadian Taxation of Trusts, (Canadian Tax Foundation), 2016.
Issue whether beneficiary can thwart retention (p. 207)
Subsection 104(18) permits an estate to retain income until a beneficiary attains a...
Jack Bernstein, "Benefitting Beneficiaries", CA Magazine, March 1996, p. 24.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(24) | 0 |
Paragraph 104(18)(c)
Administrative Policy
1 November 2005 External T.I. 2004-0100001E5 F - Revenu d'une fiducie réputé payable
A trust has different features with respect to the allocation and payment of the income and capital of a trust based on the age of certain...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(24) | position in ITTN No. 11 re payment of summer camp fees etc. also applies to non-discretionary trusts | 301 |
2 November 2005 External T.I. 2004-0093601E5 F - Fiducie au profit d'un mineur
CRA comments included:
- Although s. 104(18) cannot apply if the trust deed provides that the portion of the capital that represents income...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(18) - Paragraph 104(18)(d) | there can be discretion to delay payment, but not as to the share | 244 |
Paragraph 104(18)(d)
Administrative Policy
2 November 2005 External T.I. 2004-0093601E5 F - Fiducie au profit d'un mineur
CRA repeated its statements at 1998 APFF, Q.27 (9M18520) that:
[S]ubsection 104(18) … does not stipulate any requirement as to the date of...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(18) - Paragraph 104(18)(c) | can be discretion regarding distribution of capital other than accumulated income | 439 |
Subsection 104(19) - Designation in respect of taxable dividends
See Also
Vefghi Holding Corp. v. The King, 2023 TCC 135
The first appellant (“Vefghi Corp.”), which had a calendar taxation year, was a beneficiary of a calendar-year family trust (the “Vefghi...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Statutory Interpretation - Interpretation/Definition Provisions | scope of a deeming provision is limited to what is clearly expressed in the provision | 197 |
Administrative Policy
22 June 2023 External T.I. 2018-0746741E5 F - Eligible dividend allocation
A discretionary trust received an eligible dividend in a year and immediately allocated and distributed it to a beneficiary; and later in the same...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(13) | a discretionary trust can wholly allocate each of an eligible and a non-eligible dividend to each of two recipient beneficiaries | 82 |
7 October 2020 APFF Roundtable Q. 17, 2020-0845821C6 F - Part IV tax and trust
A personal trust (the "Trust") wholly-owns Opco, which also has a December 31 year end, and has a corporate beneficiary ("Holdco" with a September...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 186 - Subsection 186(2) | s. 104(13), unlike s. 104(19), can apply contemporaneously with a trust dividend distribution, and ss. 186(2) and 251(1)(b) can apply synergistically | 440 |
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(24) | under the ordinary meaning of payable, an amount is payable at a time if it is paid then | 450 |
26 November 2020 STEP Roundtable Q. 11, 2020-0839891C6 - Subsection 104(19)
A Canadian resident personal trust receives a dividend from ACo., and distributes the dividend to B Co (a beneficiary) to which A Co is connected...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 186 - Subsection 186(1) - Paragraph 186(1)(a) | Pt IV tax exemption no longer available because corporate beneficiary was no longer connected at December 31 effective time of s. 104(19) designation | 196 |
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(13) | designated dividend included in individual’s terminal return which has a December 31 year end | 129 |
| Tax Topics - Income Tax Act - Section 249 - Subsection 249(1) - Paragraph 249(1)(c) | individual has a calendar year, even in terminal year | 149 |
30 April 2019 Internal T.I. 2018-0757591I7 F - Part IV tax and trust
On June 23, 2017, a discretionary family trust receives a dividend on its shares of Opco and immediately on-pays that amount to a family...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 186 - Subsection 186(1) - Paragraph 186(1)(a) | a dividend received by a trust and immediately paid to a connected corporate beneficiary was taxed under Part IV if the connection ceased before the trust year end | 373 |
7 June 2019 STEP Roundtable Q. 14, 2019-0798511C6 - TOSI and PBE
As noted re Q.13, CRA considers that the exclusion from para. (c) of the “split income” definition of amounts included in a preferred...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 120.4 - Subsection 120.4(1) - Split Income - Paragraph (a) - Subparagraph (a)(i) | subjecting dividend income paid to a preferred beneficiary to TOSI accords with tax policy – but the designation can be readily avoided | 224 |
3 June 2016 External T.I. 2016-0647621E5 F - Dividend designation from a trust - timing
On May 31, 20X1 (the last day of its taxation year), Opco pays a dividend of $10,000 to a family trust, which immediately distributes that amount...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 186 - Subsection 186(1) - Paragraph 186(1)(a) | dividend distributed by a trust to a connected corporation can be subject to Part IV tax due to the delayed implied effective date of s. 104(19) designations | 115 |
11 October 2013 Roundtable, 2013-0495741C6 F - Dividend received by an employee trust
An employee trust (the "Trust") holds shares of a taxable Canadian corporation (the “Corporation”) that then redeems shares that had not been...
11 October 2013 Roundtable, 2013-0495801C6 F - Dividend Paid to Trust and Schedule 3 of T2
A trust cannot make an s. 104(19) designation until its year end (December 31) since it is only then that it can be determined that it has been...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 186 - Subsection 186(1) - Paragraph 186(1)(b) | s. 104(19)-designated dividend is not received for s. 186(1)(b) purposes until year end of trust | 80 |
14 January 2013 External T.I. 2012-0465131E5 - Dividend designation from a trust
In response to an inquiry "as to when a taxable dividend will be considered to have been received by a beneficiary of a trust where the dividend...
2 May 2011 External T.I. 2011-0392661E5 F - T2 Sched. 3 Reporting of Dividend Paid to a Trust
Where a Canadian-controlled private corporation (“Corporation A”) pays a dividend to a trust which distributes that amount to a corporate...
Income Tax Technical News, No. 41, 23 December 2009 Under "Definition of 'Tax Shelter' - Subsection 237.1(1)
"Eligible Dividend Designation - Subsection 89(14)": A taxable dividend, designated as an eligible dividend under s. 89(14) that is paid to a...
25 April 1991 Memorandum (Tax Window, No. 2, p. 23, ¶1215)
A trust can make the designation under s. 104(19) in favour of a non-resident beneficiary, and such designation will not result in an undue...
IT-372R "Trusts - Flow Through of Taxable Dividends and Interest to a Beneficiary"
Articles
David Carolin, Manu Kakkar, "Estate Plans, Trusts, and Dividends: Is There a Gap Here?", Tax for the Owner-Manager, Vol. 21, No. 1, January 2021, p. 1
Deferral opportunity arising from CRA’s position that s. 104(19)-designated dividend is not received for s. 186(1)(b) purposes until year end of...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 186 - Subsection 186(1) - Paragraph 186(1)(b) | deferral (or other) opportunities arising from CRA’s position that s. 104(19)-designated dividend is not received until year-end of trust | 279 |
Elie Roth, Tim Youdan, Chris Anderson, Kim Brown, "Taxation of Trusts Resident in Canada", Chapter 3 of Canadian Taxation of Trusts, (Canadian Tax Foundation), 2016.
Streaming of dividends and interest (pp. 121-3)
The CRA has confirmed that in the case of a fully discretionary trust, the trustees have...
Subsection 104(20) - Designation in respect of non-taxable dividends
Administrative Policy
14 May 2013 External T.I. 2012-0469591E5 F - Capital dividend received by a trust and CDA
A Canadian-controlled private corporation paid a capital dividend to its sole shareholder, a trust, in 20x1. The beneficiaries of the trust were...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 89 - Subsection 89(1) - Capital Dividend Account - Paragraph (g) | no addition for capital dividend received by trust in Year 1 and distributed in Year 2 to corporate beneficiary | 203 |
Subsection 104(21) - Designation in respect of taxable capital gains
Administrative Policy
20 June 2023 STEP Roundtable Q. 12, 2023-0959591C6 - Corporate Beneficiary and CDA
An inter vivos Canadian resident trust pays an amount equal to its net taxable capital gains for the year to a Canadian private corporation that...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 89 - Subsection 89(1) - Capital Dividend Account - Paragraph (a) - Subparagraph (a)(i.1) | no CDA addition if non-taxable half of capital gain is distributed to another beneficiary/ any CDA addition occurs at trust year end | 252 |
26 November 2020 STEP Roundtable Q. 3, 2020-0839881C6 - Distribution of taxable capital gain
A personal trust realizes a capital gain for a particular taxation year and would like to designate it as the taxable capital gain of a...
24 March 2015 External T.I. 2012-0470991E5 F - Mutual fund trust
Would a s. 39(4) election apply even if a mutual fund trust was a "day trader" that used margin? CRA stated (TaxInterpretations...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 132 - Subsection 132(6) | day trading included in investment undertaking | 62 |
| Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(a) - Income-Producing Purpose | s. 39(4) presumption establishing expense non-deductibility | 64 |
| Tax Topics - Income Tax Act - Section 39 - Subsection 39(5) - Paragraph 39(5)(a) | election can be made by leveraged day-trading MFT | 183 |
| Tax Topics - Income Tax Act - Section 9 - Capital Gain vs. Profit - Shares | capital v. income character determined at trust level | 94 |
16 June 2014 STEP Roundtable, 2014-0523061C6 - Trust audit issues
CRA noted that 2014-051719117 concerned a discretionary family trust (of which father and the adult children were capital and income...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 105 - Subsection 105(1) | benefit conferred when trust shares redeemed at undervalue | 196 |
| Tax Topics - Income Tax Act - Section 112 - Subsection 112(3.2) | taxpayer stuck with two-transaction form | 155 |
| Tax Topics - Income Tax Act - Section 118.1 - Subsection 118.1(1) - Total Charitable Gifts | executors lacked power to make gift | 92 |
| Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(a) - Legal and other Professional Fees | legal and accounting expenses | 45 |
| Tax Topics - Income Tax Act - Section 75 - Subsection 75(2) | settlor taking back undervalued freeze shares | 76 |
25 February 2014 Internal T.I. 2014-0517191I7 - Late or amended 104(21) designation
Following the filing of its T3 return, a discretionary family trust purported to make 104(21) and (21.2) designations respecting the net taxable...
2007 Ruling 2007-0245281R3 - windup of income trust on sale of assets:3rd party
Ruling that following the redemption of all the outstanding units of an income fund, any document that the fund is required to file under the Act...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 40 - Subsection 40(3.3) | capital loss on redemption of trust units following distribution of most of its assets including as capital gains distribution | 110 |
| Tax Topics - Income Tax Act - Section 53 - Subsection 53(2) - Paragraph 53(2)(h) - Subparagraph 53(2)(h)(i.1) | no ACB reduction for capital gains distribution by unit trust to bidco | 86 |
| Tax Topics - Income Tax Act - Section 20 - Subsection 20(1) - Paragraph 20(1)(c) | assumed debt traceable to capital distribution | 97 |
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(6) | realization and distribution of target MFT gain | 101 |
| Tax Topics - Income Tax Act - Section 80 - Subsection 80(1) | 90 | |
| Tax Topics - Income Tax Act - Section 80 - Subsection 80(5) | 90 |
12 September 2003 External T.I. 2003-0001335 F - Gain en Capital par une fiducie
A discretionary family trust realized a capital gain of $2M from disposing of shares of a small business corporation and distributed only $1M of...
1998 Strategy Institute Round Table 981493
A beneficiary's entitlement to only the taxable portion (75%) of a capital gain of a trust would not affect the amount available to be designated...
12 December 1996 External T.I. 9629345 - DSG'N OF A REALIZED TCG TO BENEFICIARIES WHEN PAID
Where a trust realizes a capital gain on distributing preferred shares to beneficiaries who are both income and capital beneficiaries pursuant to...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(6) | 22 |
12 April 1995 External T.I. 9417135 - CANADIAN MUTUAL FUND TRUST-NON-RESIDENT
Taxable capital gains of a mutual fund trust designated to a non-resident unitholder under s. 104(21) would not be taxable in Canada.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 118.9 - Subsection 118.9(4) | 10 | |
| Tax Topics - Income Tax Act - Section 212 - Subsection 212(11) | 23 | |
| Tax Topics - Treaties - Income Tax Conventions - Article 22 | 27 |
28 June 1993 T.I. (Tax Window, No. 32, p. 11, ¶2605)
A capital gain realized by a trust will be allocated in accordance with the trust deed or, if the trust deed is silent, to the income...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 118.1 - Subsection 118.1(6) | 20 |
IT-381R3 "Trusts - Deduction of Amounts Paid or Payable to Beneficiaries and Flow-Through of Taxable Capital Gains to Beneficiaries" 14 February 1997
5
A trust that has realized taxable capital gains in a particular taxation year may, within the limits of subsection 104(21), designate in its...
Forms
Subsection 104(21.2) - Beneficiaries’ taxable capital gain
Administrative Policy
15 June 2022 STEP Roundtable Q. 1, 2021-0922021C6 - 104(21.2) Designation
Subsection 104(21) permits a trust to designate, in respect of a beneficiary under the trust, a portion of its net taxable capital gains...
2 September 2020 External T.I. 2018-0738271E5 F - Taxable capital gain designation
2019-0818301I7 F reversed 2016-0667361E5 and found that (with the proper designations at both levels under ss. 104(21) and (21.2),) taxable...
13 August 2020 Internal T.I. 2019-0818301I7 F - Taxable capital gain designation
Trust 1, a personal trust resident in Canada disposed of qualified small business corporation (QSBC) shares to an unrelated third party. The...
26 November 2020 STEP Roundtable Q. 17, 2020-0837001C6 - Trust Pass-Through of CGE
A graduated rate estate (Trust 1) holding qualified small business corporation (QSBC) shares, as defined in subsection 110.6(1) has two...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 108 - Subsection 108(1) - Eligible Taxable Capital Gains | "annual gains limit" takes into account lower tier trust's ss. 104(21) and (21.2) designations | 123 |
3 August 2018 Internal T.I. 2018-0755351I7 - Trust claiming CG reserve
In response to questions as to whether the lifetime capital gains exemption (LCGE) was available where a personal trust claimed a capital gains...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 110.6 - Subsection 110.6(31) | s. 110.6(31) limitation on LCGE claims applied to capital gains reserves distributed by a personal trust | 265 |
6 December 2017 External T.I. 2016-0667361E5 F - Taxable Capital Gains Designation
A resident personal trust ("Trust 1") realized a capital gain from the disposition of "qualified small business corporation shares" ("QSBCS"), and...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 110.6 - Subsection 110.6(1) - Annual Gains Limit | annual gains limit of upper-tier trust does not include QSBC gains distributed and designated by lower-tier trust | 144 |
23 June 2015 External T.I. 2015-0571801E5 F - Allocation of Capital Gains to Beneficiaries
A discretionary family trust, with Mr., his wife and their children and grandchildren as beneficiaries, disposes of qualified small business...
29 April 2014 External T.I. 2014-0518951E5 F - Taxable capital gain designation from a trust
A testamentary trust disposed of qualified small business corporation shares in 2013 during its taxation year ending January 31, 2014. Would the...
9 February 2004 External T.I. 2003-0004401E5 F - Bien agricole admissible - fiducie
Regarding an inter vivos trust that disposed of a qualified farm property and allocated the gain to beneficiaries who had not been involved in the...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 110.6 - Subsection 110.6(1) - Qualified Farm or Fishing Property | 2 successive corporations could together satisfy the 24-month test in s. (a)(vi)(B) of qualified farm property | 271 |
IT-381R2 "Trusts - Deduction of Amounts Paid or Payable to Beneficiaries and Flow-Through of Taxable Capital Gains to Beneficiaries" under "Double Taxation Relief"
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 108 - Subsection 108(1) - Testamentary Trust | 20 | |
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(6) | 124 |
Articles
Dane ZoBell, "Spousal Trusts Have Limited CGD Access", Canadian Tax Focus (Canadian Tax Foundation), Vol. 8, No. 1, February 2018, p. 15
CGD drawbacks of using a spousal trust (p. 15)
[A] spousal trust has two drawbacks that may lead the testator to consider having the spouse own...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(13.4) | 90 |
Subsection 104(22) - Designation in respect of foreign source income
Administrative Policy
IT-506 "Foreign Income Taxes as a Deduction From Income" 5 January 1987
- … Since the rules in subsection 104(22) apply only to that subsection and to section 126, a beneficiary may not utilize the provisions of...
2005 Ruling 2004-0106481R3 - Employee benefit plan-Shares
Employees ("Participants") of the "Corporation," which is resident in Canada, or of the Corporation's non-resident listed parent (the "Parent") or...
IT-201R2 "Foreign Tax Credit — Trust and Beneficiaries" 12 February 1996
- Subsection 104(22) allows a trust to designate its foreign source income for a taxation year to its beneficiaries provided the trust was resident...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(22.1) | 135 |
Articles
Manjit Singh, Andrew Spiro, "The Canadian Treatment of Foreign Taxes", 2014 Conference Report, (Canadian Tax Foundation), 22:1-37
Pure flow-through structure for designation of foreign business income (p 15)
An alternative to this structure [Canadian LP atop US LP atop US...
Hugh Chasmar, "Mutual Fund 'Switch Funds'", Taxation of Corporate Reorganizations, Canadian Tax Journal, Vol. 46, No. 1, 1998, p. 172 at 190
"Many fund managers, however, do not allocate foreign source income and foreign taxes to investors in a trust. The marginal tax benefit to most...
Subsection 104(22.1) - Foreign tax deemed paid by beneficiary
Administrative Policy
IT-201R2 "Foreign Tax Credit — Trust and Beneficiaries" 12 February 1996
- When, as a result of a designation [under s. 104(22)], a portion of the income of a trust from a foreign source is deemed to be income of a...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(22) | 209 |
Subsection 104(23) - Testamentary trusts
Administrative Policy
26 November 2020 STEP Roundtable Q. 1, 2020-0839931C6 - Executor's Year of a GRE
Should the income of a graduated rate estate for its final year be taxed in the estate or in the hands of the beneficiaries or of the estate,...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(6) | elaboration of executor's year policy | 477 |
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(13.3) | scope of application of s. 104(13.3) | 152 |
2 October 1996 Administrative Letter 962292A - multiple returns for deceased beneficiary of trusts
Although, where a taxpayer is a beneficiary under more than one testamentary trust, she may elect under s. 104(23)(d) separately in respect of...
Paragraph 104(23)(a)
Administrative Policy
7 September 1994 Internal T.I. 9406256 - FIRST AND LAST TAXATION YEAR OF A TESTAMENTARY TRUST
"The final taxation year of a testamentary trust winding-up will end on the date of final distribution of its assets and not at its normal...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Fiscal Period | 20 |
Subsection 104(24) - Amount payable
See Also
Fiducie Historia v. The King, 2024 TCC 76
CRA considered that the trustees of a family trust had improperly delegated their fiduciary powers to other individuals (the Rémillard Brothers)...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(6) - Paragraph 104(6)(b) | trust distributions were lawful and deductible even though on paper the trustees had improperly delegated their powers | 554 |
| Tax Topics - General Concepts - Illegality | Minister did not have standing regarding a challenge to a transaction that is voidable for illegality rather than void – although such illegality was not made out on the facts | 435 |
Commissioner of Taxation v Carter, [2022] HCA 10
The respondent taxpayers were the beneficiaries of an inter vivos trust settled by their father. Under the terms of the trust, they were entitled...
Caplan v. Agence du revenu du Québec, 2019 QCCQ 3269
Two university-age children received income-distribution cheques from the discretionary family trust, and endorsed them to their father (who was...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(13) | family trust income purportedly distributed to the children beneficiaries was in fact received by the father as beneficiary | 258 |
Lewski v Commissioner of Taxation, [2017] FCAFC 145
On June 30, 2006, the trustee of a trust resolved that 100% of all of its income for the year then ending would be paid, applied and set aside to...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(a) - Incurring of Expense | obligation to pay purchase price was incurred on agreement date rather than subsequent closing | 430 |
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(8) - Paragraph 248(8)(b) | since the taxpayer through her husband as agent had knowledge of an income distribution, her subsequent purported disclaimer was not immediate | 304 |
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(13) | a trust income declaration that was subject to a tax contingency did not result in an income inclusion to the beneficiary | 149 |
| Tax Topics - General Concepts - Agency | knowledge of agent imputed to principal | 217 |
Hall v. The Queen, 2003 DTC 779, 2003 TCC 410 (Informal Procedure)
Interest income of an estate in respect of which the executor, a trust company, issued T5 slips to the taxpayer beneficiaries was not payable to...
Degrace Family Trust v. The Queen, 99 DTC 453 (TCC)
In finding that trust property spent by Mrs. Degrace, the sole trustee of a family trust, on such matters as mortgage payments, decorating costs,...
Langer Family Trust v. MNR, 92 DTC 1055, [1992] 1 CTC 2119 (TCC)
Trustees of a family trust used amounts withdrawn from the bank account of the family corporation to pay various personal expenses (which in three...
Ginsburg v. MNR, 92 DTC 1774, [1992] 2 CTC 2152 (TCC)
The taxpayer was entitled under the will of her late husband to all the income from the residue of his estate under a spousal trust, and received...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(8) - Paragraph 248(8)(b) | backdated renunciation was ineffective | 166 |
Grayson v. MNR, 90 DTC 1108, [1990] 1 CTC 2303 (TCC)
A deceased friend of the taxpayer had provided in his will for the devising of all his property to the taxpayer. Although the will did not specify...
Administrative Policy
3 November 2023 APFF Financial Strategies and Instruments Roundtable Q. 8, 2023-0976901C6 F - RPP survivor benefit flowing through a GRE
CRA indicated that s. 104(24) would be satisfied regarding the distribution by an estate of a pension benefit received by it to the sole...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(27) | full flow-through of a pension benefit received by the estate to the surviving spouse for s. 60(j) purposes by the estate issuing her a note | 287 |
| Tax Topics - Income Tax Act - Section 60 - Paragraph 60(j) | flow-through of pension benefit by estate to surviving spouse through cash and note issuance/ no FHSA deduction for s. 104(27) amount | 381 |
3 May 2022 CALU Roundtable Q. 9, 2022-0928891C6 - Subsection 104(6)
CRA indicated that the fact that the distribution was paid in the year did not establish (e.g., under s. 104(24)) that it was payable for the...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(6) | a trust cannot get a deduction for distributing phantom income if the trust deed lacks a phantom income clause | 377 |
15 June 2021 Internal T.I. 2020-0867081I7 - Pension Benefit Received by Estate
After the Office of the Public Trustee for the Province (the “Trustee”) finalized the Estate of the deceased, received a CRA clearance...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Graduated Rate Estate | no CRA authority to extend 36-month period | 180 |
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(27) | s. 104(27) unavailable after estate ceased to be a GRE | 96 |
7 October 2021 APFF Financial Strategies and Instruments Roundtable Q. 10, 2021-0896101C6 F - Death of seg. fund policyholder - income allocatio
In light of s. 138.1(1)(f), the taxable income of a related segregated fund trust is deemed for the purposes of computing the income of the trust...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 138.1 - Subsection 138.1(1) - Paragraph 138.1(1)(f) | accrued income under a segregated fund is not deemed by s. 138.1(1)(f) to be a right or thing | 382 |
15 June 2021 STEP Roundtable Q. 14, 2021-0883041C6 - Extending the GRE 36-month period
CRA stated that where an estate receives a lump sum from a pension plan of the deceased beyond the 36-month period in which it could qualify as a...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Graduated Rate Estate | no CRA discretion to extend the 36 month period | 125 |
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(27) | s. 104(27) designation could not be made for a pension amount received after a trust ceased to be a GRE | 170 |
7 October 2020 APFF Roundtable Q. 17, 2020-0845821C6 F - Part IV tax and trust
A personal trust wholly-owns Opco, which also has a December 31 year end, and has a corporate beneficiary ("Holdco") with a September 30 taxation...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(19) | various applications of proposition that an s. 104(19) designation is not effective until the trust’s year end | 761 |
| Tax Topics - Income Tax Act - Section 186 - Subsection 186(2) | s. 104(13), unlike s. 104(19), can apply contemporaneously with a trust dividend distribution, and ss. 186(2) and 251(1)(b) can apply synergistically | 440 |
5 October 2018 APFF Roundtable Q. 2, 2018-0768901C6 F - Deemed dividend payable to trust beneficiary
Following the death of the spouse respecting a spousal trust, the trust’s sole asset (a private company) is wound-up, thereby giving rise to a...
14 September 2017 Roundtable, 2017-0703921C6 - 2017 CPA Alberta Q25: Estates – Income Paid or Payable
An individual’s will simply provides for the executor to pay all debts, and distribute the estate in equal portions to the three adult children....
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(6) | income of fixed-interest trust is not per se payable | 203 |
13 June 2017 STEP Roundtable Q. 10, 2017-0693351C6 - 104(6), (13), (24) and ITTN 11
A father who is the trustee of a discretionary family trust reimburses himself out of the trust funds for itemized expense of restaurant meals of...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(6) | a discretionary family trust may be unable to establish that expenses reimbursed by it were for the children’s benefit | 305 |
1 November 2016 Internal T.I. 2016-0663971I7 - 104(6)(b), whether amount became payable
Although the trust indenture for a family trust specified that no “designated person” beneficiary could receive or otherwise obtain the use of...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 105 - Subsection 105(1) | income distributions to minor beneficiaries contrary to trust deed included under s. 105(1) | 151 |
| Tax Topics - General Concepts - Illegality | distribution contrary to trust deed not considered to be payable | 137 |
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(6) | prohibited distribution from trust | 76 |
25 July 2016 External T.I. 2016-0630781E5 - 104(13.3) and a CPP/QPP death benefit
Is the option to include a Canada Pension Plan (“CPP”) or Quebec Pension Plan (“QPP”) death benefit on a post-2015 T3 return will no...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(13.3) | CPP benefit generally no longer eligible under 104(13.1) | 162 |
29 November 2016 CTF Roundtable Q. 14, 2016-0669871C6 - Estate distribution
A simple Will typically directs the Executor to pay the debts and expenses of the deceased, makes specific bequests of property and finally...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(6) | income from an estate residue generally can be distributed on a deductible basis | 147 |
8 June 2016 External T.I. 2015-0604971E5 - Deemed capital gain of a trust
1) Where the power to encroach on capital is general and the trustees exercise their discretion to encroach before the end of the trust’s year...
27 April 2016 External T.I. 2016-0625001E5 F - Surplus Stripping
An individual (Mr. X), and a corporation (Holdco) wholly owned by him are the beneficiaries of a Quebec discretionary trust (Trust) holding all...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 84 - Subsection 84(2) | using a trust to funnel a deemed dividend from creating PUC to a Holdco beneficiary and funnelling that PUC to the individual beneficiary, is surplus stripping | 220 |
| Tax Topics - Income Tax Act - Section 245 - Subsection 245(4) | funnelling deemed dividend to holdco trust beneficiary and resulting PUC to individual beneficiary/shareholder was surplus stripping | 130 |
10 June 2016 STEP Roundtable Q. 12, 2016-0634921C6 - Phantom Income
A trust realizes “phantom income,” for example, a deemed capital gain under a s. 48.1 when its shares of a CCPC become publicly listed. How...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(6) | payment in kind of distribution of phantom income | 78 |
9 October 2015 APFF Financial Strategies and Instruments Roundtable Q. 6, 2015-0595851C6 F - Income of a trust payable to a beneficiary
Where a trust distributes all of its share of the accounting profits of a partnership but its share of the taxable income of the partnership is...
2 October 2015 External T.I. 2015-0595111E5 F - Amount paid pursuant to 104(24)
Would the delivery of property from a trust to a beneficiary constitute an amount that had become payable under s. 104(24)? CRA responded:
[A]n...
5 October 2012 Roundtable, 2012-0453581C6 F - Somme payable - revenus de placements
A taxable capital gain of $375,000 was allocated to Beneficiary A of a discretionary family trust ("Trust") for which an amount is payable to him...
10 July 2013 Internal T.I. 2013-0475501I7 F - Amounts returned to trustee/beneficiary
Father and Y were the trustees of a Quebec family trust, whose beneficiaries included father and his three children. Distributions made by the...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(13) | family trust income distributed to children but repaid as reimbursement to father for family expenses was income to him, not them | 221 |
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(6) | distributions to children immediately paid to father were deductible even though received by children as his agents | 179 |
| Tax Topics - Income Tax Act - 101-110 - Section 105 - Subsection 105(1) | payment of income distributions by children to father not a benefit under the trust | 230 |
| Tax Topics - Income Tax Act - Section 56 - Subsection 56(4) | payment of distributed family trust income by children to father did not engage s. 56(4) as it was only potential income to him | 175 |
4 March 2013 External T.I. 2011-0428661E5 - trust payments to minor
The trustees of a civil law trust exercise their discretionary power in order to allocate an amount of income or taxable capital gain to a minor...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 75 - Subsection 75(2) | 142 |
30 October 2012 Ontario CTF Roundtable, 2012-0462931C6 - CTF Ontario Conference- Trust payment to Minor
In response to a query as to whether the requirement, for "proper notice" being given to a beneficiary as to a demand promissory note being given...
28 May 2012 CTF Prairie Trust Roundtable, 2012-0444891C6 - CTF Prairie Conference- Trust payment to Minor
CRA confirmed that "proper notice" of payment to a minor beneficiary by way of issuance of a promissory note can be given to the beneficiary's...
8 June 2010 STEP Roundtable Q. 2, 2010-0363071C6
For an amount to be "payable" to a beneficiary in a trust's taxation year, the beneficiary must have an enforceable right to payment by the end of...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - General Concepts - Effective Date | 153 |
8 October 2010 Roundtable, 2010-0373601C6 F - Vérification des fiducies familiales
CRA noted:
A national project was initiated in fiscal year 2005-2006 to develop an audit strategy for trusts resident in Canada. That project was...
8 October 2010 Roundtable, 2010-0373431C6 F - Montants payés ou payables par une fiducie
CRA has stated that in cases where amounts of distributed income are not paid in cash, not only must the trust issue a promissory note, but it...
1 November 2005 External T.I. 2004-0100001E5 F - Revenu d'une fiducie réputé payable
In responding to an inquiry regarding the payment by the trustee of a trust, that potentially qualified with the non-discretionary elements...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(18) - Paragraph 104(18)(c) | trust can become discretionary once all beneficiaries have attained 21 | 166 |
30 September 2005 External T.I. 2004-0093661E5 F - Revenu d'une fiducie et droit acquis par un mineur
How can the trustee designate or report an amount so that it is considered to be payable to a beneficiary?
After noting that CRA has not relied on...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(6) | a specific clause allocating taxable portion of capital gains to income beneficiary and non-taxable portion to capital beneficiary can be recognized | 161 |
8 October 2004 APFF Roundtable Q. 6, 2004-0090831C6 F - 12(4) L.I.R. et fiducies personnelles
Can a personal trust annually allocate to its beneficiaries the interest income deemed to be earned by it on a prescribed debt obligation such as...
24 June 2003 External T.I. 2003-0000695 - Capital distribution to n/r beneficiary
A resident testamentary trust, which was created to hold shares of a publicly traded corporation, distributes the shares (which are not taxable...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(6) | distribution of capital property with accrued gain entails distribution of that gain | 205 |
| Tax Topics - Income Tax Act - 101-110 - Section 107 - Subsection 107(2.11) | Pt XIII tax exigible, in absence of election, on distribution to NR of appreciated capital property | 49 |
6 March 2001 External T.I. 2000-0060825 - Employee Benefit Plan
"While most mutual fund trusts calculate the amount of income for a year to be distributed to the unitholders after the year-end, the trust...
Income Tax Technical News, No. 11, September 30, 1997, Payments Made by a Trust for the Benefit of a Minor Beneficiary".
Trust distributions for benefit of minor chidren
The trustee of a discretionary trust may decide to allocate trust income for the benefit of a...
26 August 1997 External T.I. 9722465 - AMOUNTS PAYABLE TO MINOR BENEFICIARIES
Discussion of the circumstances in which a payment made by a discretionary trust to third parties for the benefit of minor beneficiaries will be...
6 March 1997 Internal T.I. 9606227 - amount payable to a beneficiary of a discretionary trust
Legal entitlement of a beneficiary to enforce payment to her of income of the trust is established by (a) the trustees irrevocably exercising...
1 August 1996 External T.I. 9604555 - AMOUNT PAYABLE SUBSECTION 104(24)
The fact that the amount of income of an inter vivos family trust cannot be known at year-end because the only source of income of the trust is a...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - General Concepts - Payment & Receipt | promissory note normally only constitutes an enforceable right to the income where it is payable on demand | 119 |
13 June 1995 Internal T.I. 9514227 - PAYMENT INTO COURT BY AN ESTATE FOR DECEASED'S CHILDREN SECTION 104(24)
Where pension income receivable by an estate is paid pursuant to a court order into the court for the benefit of the deceased's minor children,...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(18) | 71 |
27 March 1994 9508671 - LIFETIME CAPITAL GAINS EXEMPTION & PERSONAL TRUST
Because it is not possible for a deemed capital gain (in this instance, arising under s. 110.6(19)) to be income (or a capital gain) for trust...
81 C.R. - Q.55
Where a particular beneficiary's entitlement to or share of the income of a trust is before the courts, the amount cannot be considered to be...
IT-286R2 "Trusts - Amount Payable"
Finance
6 October 2017 APFF Financial Strategies and Instruments Roundtable, Q.11
In 2015-0595851C6, CRA indicated that where a trust distributes all of its share of the accounting profits of a partnership but its share of the...
Articles
Elie Roth, Tim Youdan, Chris Anderson, Kim Brown, "Taxation of Trusts Resident in Canada", Chapter 3 of Canadian Taxation of Trusts, (Canadian Tax Foundation), 2016.
Deduction for payment for benefit of minor with parent’s consent (pp. 205-6)
The court in Langer Family Trust held that subsection 104(24)...
Jack Bernstein, "Recent Tax Issues Affecting Family Trusts", Tax Profile, Vol. 5, No. 21, May 1998, p. 247.
Jack Bernstein, "Benefitting Beneficiaries", CA Magazine, March 1996, p. 24.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(18) | 0 |
Gabrielle Richards, "Executor's Year", Canadian Current Tax, October 1987, p. J49
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(6) | 0 |
Subsection 104(27)
Administrative Policy
3 November 2023 APFF Financial Strategies and Instruments Roundtable Q. 8, 2023-0976901C6 F - RPP survivor benefit flowing through a GRE
Sylvie, was the sole heir of Paul, her deceased spouse, who died on June 1, 2020, was a member of a registered pension plan (RPP) and had not made...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(24) | income can be distributed to estate beneficiary by issuing a demand note to her | 58 |
| Tax Topics - Income Tax Act - Section 60 - Paragraph 60(j) | flow-through of pension benefit by estate to surviving spouse through cash and note issuance/ no FHSA deduction for s. 104(27) amount | 381 |
15 June 2021 Internal T.I. 2020-0867081I7 - Pension Benefit Received by Estate
An estate received a lump sum pension payment after it had ceased to be a graduated rate estate, and then distributed the amount to the...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Graduated Rate Estate | no CRA authority to extend 36-month period | 180 |
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(24) | up to the trustee to determine whether an amount received on the last day of the year was payable to the beneficiary on that date | 224 |
15 June 2021 STEP Roundtable Q. 14, 2021-0883041C6 - Extending the GRE 36-month period
CRA stated that where an estate receives a lump sum from a pension plan of the deceased beyond the 36-month period in which it could qualify as a...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Graduated Rate Estate | no CRA discretion to extend the 36 month period | 125 |
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(24) | pension benefit not distributed to beneficiary might nonetheless be payable in the year | 113 |
7 October 2011 Roundtable, 2011-0420781C6 F - Transfert de RPA à un REER au décès.
The will of a deceased taxpayer, who had been a member of a registered pension plan ("RPP"), provided for the bequest of all his property to his...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Regulations - Regulation 103 - Subsection 103(4) | withholding required where RPP administrator pays RPP lump sum directly to RRSP of disabled minor daughter beneficiary of estate | 335 |
| Tax Topics - Income Tax Act - Section 60 - Paragraph 60(l) - Subparagraph 60(l)(v) - Clause Subparagraph 60(l)(v)(B.01) | s. 60(l) deduction where RPP administrator pays RPP lump sum directly to RRSP of disabled minor daughter beneficiary of estate | 394 |
Paragraph 104(27)(d)
Subparagraph 104(27)(d)(ii)
Administrative Policy
7 March 2014 Internal T.I. 2013-0506671I7 F - Subparagraph 104(27)(d)(ii) and paragraph 60(j)
Can a testamentary trust designate for one of its beneficiaries a benefit that does not constitute an eligible amount determined under paragraph...
Subsection 104(28)
Administrative Policy
S2-F1-C2 - Retiring Allowances
Payment of retiring allowance after death
2.27 An individual might terminate employment but die before receiving all or a part of a retiring...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Retiring Allowance | 760 | |
| Tax Topics - Income Tax Act - Section 60 - Paragraph 60(j.1) | 195 | |
| Tax Topics - Income Tax Act - Section 3 | 224 |