Section 107.4

Subsection 107.4(1) - Qualifying disposition

Administrative Policy

2018 Ruling 2018-0778961R3 - Partial transfer to new funds

Background

In connection with an arm’s length acquisition transaction, apparently of the business of managing (exchange-listed mutual fund...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - 101-110 - Section 107.4 - Subsection 107.4(2.1) use of s. 107.4(2.1) in transfer of portion of MFT to a new MFT 223

2017 Ruling 2016-0625301R3 - Merger of two related segregated fund trusts

Background

The Taxpayer, an insurance company, established two segregated funds (Fund1 and 2), which used portions of the premiums paid by Fund 1...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 138.1 - Subsection 138.1(1) - Paragraph 138.1(1)(a) reallocation by insurer of securities held for one segregated fund to being held for the second segregated fund effected their transfer to the second fund viewed as a deemed trust 125

2013 Ruling 2013-0492731R3 - qualifying disposition -mutual fund trust

Current structure

The Fund is an open-end mutual fund trust, whose units trade on an exchange. It owns all the units of Sub Trust (a resident...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 132 - Subsection 132(6) MFT's trustee not to be a director of a sub 119
Tax Topics - Income Tax Act - Section 132.2 - Subsection 132.2(1) - Qualifying Exchange elimination of REIT subtrust through s. 107.4 transfer to new "in house" MFT and s. 132.2 merger of MFT into REIT 97

2013 Ruling 2013-0488351R3 - Conversion of a MFC to a MFT

The same (mutual fund corporation) taxpayer as for 2013 Ruling 2011-0395091R3 (immediately below) obtained essentially the same rulings for...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 132.2 - Subsection 132.2(1) - Qualifying Exchange conversion of MFC to MFT and subtrust elimination 178
Tax Topics - Income Tax Act - Section 21 - Subsection 21(1) election of GP to capitalize loss before elimination of subtrust 204

2013 Ruling 2011-0395091R3 - MFC to MFT Conversion

Background

Taxpayer, which is a listed mutual fund corporation, wishes to convert to a mutual fund trust (so that following the conversions...

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17 October 2012 Ruling 2011-0428321R3 - qualifying disposition -mutual fund trust

Various mutual fund trusts (the "Funds") have several classes of outstanding units.

The sole difference among the various classes of Units is the...

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Paragraph 107.4(1)(a)

Administrative Policy

9 April 2020 External T.I. 2014-0527261E5 F - Beneficial ownership discretionary power of trustees

An individual resident in Canada settles and contributes capital property to a trust governed by the Civil Code of Québec (the "C.C.Q.") under...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - 101-110 - Section 107.4 - Subsection 107.4(1) - Paragraph 107.4(1)(i) discretion of trustees to retain capital or income rather than distribute to the sole current beneficiary precluded s. 73(1.01)(c)(ii) application and satisfied s. 107/4(1)(i) 291
Tax Topics - General Concepts - Ownership discretion of trustee to accumulate rather than distribute income to sole beneficiary did not detract from beneficial ownership 269
Tax Topics - Income Tax Act - Section 73 - Subsection 73(1.01) - Paragraph 73(1.01)(c) - Subparagraph 73(1.01)(c)(ii) "right to receive" all the income not satisfied where trustees' discretion to accumulate income 233

2018 Ruling 2018-0752811R3 - Transfer of Debt as Qualifying Disposition

Current Structure

The units of the REIT (a real estate investment trust) are stapled to those of Finance Trust (a portfolio investment entity and...

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2017 Ruling 2017-0720591R3 - Re-org of a stapled commercial trust structure

Current Structure

The units of the REIT (a real estate investment trust) are stapled to those of Finance Trust (a portfolio investment entity and...

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14 March 2012 External T.I. 2011-0423291E5 F - Fiducie pour soi-même sans limite d'âge

Two spouses (Mr. X and Ms. X) and their two adult children wish to contribute their jointly owned shares of Holdco to a newly-settled protective...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 73 - Subsection 73(1.01) - Paragraph 73(1.01)(c) - Subparagraph 73(1.01)(c)(ii) joint protective trust would not satisfy s. 73(1.01)(c)(ii) 180
Tax Topics - Income Tax Act - Section 73 - Subsection 73(1.01) - Paragraph 73(1.01)(c) - Subparagraph 73(1.01)(c)(iii) - Clause 73(1.01)(c)(iii)(A) two spouses separate from their children can create a joint spousal or common-law partner trust 156
Tax Topics - Income Tax Act - 101-110 - Section 108 - Subsection 108(1) - Testamentary Trust tainting effect of joint spousal or common-law partner trust on subsequent testamentary trust 211

2004 Ruling 2003-0053981R3 - XXXXXXXXXX

Proposed transactions
  1. The Fund, which is an exchange-traded mutual fund trust, will for nominal consideration subscribe for one Trust Unit of a...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 245 - Subsection 245(4) elimination of MFT corporate sub through creation of MFC and 132.2 merger 160
Tax Topics - Income Tax Act - 101-110 - Section 107.4 - Subsection 107.4(1) - Paragraph 107.4(1)(h) immediate refinancing of drop-down subsidiary trust of MFT did not offend policy of para. (h) 234
Tax Topics - Income Tax Act - 101-110 - Section 107.4 - Subsection 107.4(3) - Paragraph 107.4(3)(m) units must be received on drop-down of LP to new subtrust (thereby ousting s. 107.4(2)(a)), in order to receive outside basis under s. 107.4(3)(m) 241

Articles

Geraint Thomas, Alastair Hudson, "Chapter 7: The Nature of a Beneficiary’s Interest", The Law of Trusts,” Oxford University Press, 2004

Under some trusts the beneficiary has rights in rem against the trust property (p. 173)

7.01 The debate on the nature of a beneficiary's interest...

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Locations of other summaries Wordcount
Tax Topics - General Concepts - Ownership 1016

Paragraph 107.4(1)(h)

Administrative Policy

2004 Ruling 2003-0053981R3 - XXXXXXXXXX

A publicly-trade mutual fund trust (the "Fund") eliminated a corporate subsidiary ("Holdings") by incorporating a subsidiary ("MFC") with a modest...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - 101-110 - Section 107.4 - Subsection 107.4(1) - Paragraph 107.4(1)(a) qualifying drop-down of partnership units to subsidiary unit trust where s. 107.4(2)(a) was ousted due to units issuance 246
Tax Topics - Income Tax Act - Section 245 - Subsection 245(4) elimination of MFT corporate sub through creation of MFC and 132.2 merger 160
Tax Topics - Income Tax Act - 101-110 - Section 107.4 - Subsection 107.4(3) - Paragraph 107.4(3)(m) units must be received on drop-down of LP to new subtrust (thereby ousting s. 107.4(2)(a)), in order to receive outside basis under s. 107.4(3)(m) 241

Paragraph 107.4(1)(i)

Administrative Policy

9 April 2020 External T.I. 2014-0527261E5 F - Beneficial ownership discretionary power of trustees

An individual resident in Canada settles and contributes capital property to a Quebec trust under which the settlor is one of the two trustees and...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - 101-110 - Section 107.4 - Subsection 107.4(1) - Paragraph 107.4(1)(a) discretion of trustees to retain capital or income rather than distribute to the sole current beneficiary does not preclude the latter being the beneficial owner 277
Tax Topics - General Concepts - Ownership discretion of trustee to accumulate rather than distribute income to sole beneficiary did not detract from beneficial ownership 269
Tax Topics - Income Tax Act - Section 73 - Subsection 73(1.01) - Paragraph 73(1.01)(c) - Subparagraph 73(1.01)(c)(ii) "right to receive" all the income not satisfied where trustees' discretion to accumulate income 233

Subsection 107.4(2) - Application of paragraph (1)(a)

Paragraph 107.4(2)(a)

Administrative Policy

2017 Ruling 2016-0660321R3 - Reorg of REIT to simplify multi-tier structure

Overview

A Canadian REIT (the “Fund”) holds the units and notes of a subsidiary unit trust (“Sub-Trust”), whose principal asset is most of...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 132.2 - Subsection 132.2(1) - Qualifying Exchange use of the s.132.2 merger and a renunciation of most of the units otherwise issuable on the merger in order to eliminate a REIT corporate subsidiary held through an LP and a sub-trust 1006
Tax Topics - Income Tax Act - Section 98 - Subsection 98(3) drop down of LP 1 into LP 2 followed by immediate s. 98(3) wind-up of LP 1 into LP 2 and GP of LP1, followed by immediate taxable sale by GP to LP 2 146
Tax Topics - Income Tax Act - Section 246 - Subsection 246(1) no taxable benefit where wholly-owned partnership renounces the right to have consideration paid for the redemption of its shares in its limited partner (a mutual fund corporation) 325
Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Disposition no disposition on conversion of general to limited partnership or adding right of renunciation of a MFT unitholder 165
Tax Topics - Income Tax Act - Section 132.2 - Subsection 132.2(3) - Paragraph 132.2(3)(g) - Subaragraph 132.2(3)(g)(vi) - Clause 132.2(3)(g)(vi)(C) - Subclause 132.2(3)(g)(vi)(C)(I) renunciation by subsidiary partnership of transferee MFT of units that otherwise would be issuable on the redemption of its incestuous holding in transferor MFC 245

2003 Ruling 2003-000498C - Qualifying disposition from trust to Sub

Current structure

The Fund, which is an exchange-listed mutual fund trust, holds shares and debt (the Corporation Shares and the Corporation...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - 101-110 - Section 107.4 - Subsection 107.4(3) - Paragraph 107.4(3)(m) no increase to ACB of subtrust units where dropdown to the subtrust for no consideration 55

Subsection 107.4(2.1)

Administrative Policy

2018 Ruling 2018-0778961R3 - Partial transfer to new funds

In connection with an arm’s length acquisition transaction, apparently of the business of managing exchange-listed mutual fund trusts, holders...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - 101-110 - Section 107.4 - Subsection 107.4(1) use of s. 107.4 transfers to split up ETFs 599

Subsection 107.4(3) - Tax consequences of qualifying dispositions

Administrative Policy

20 March 2013 External T.I. 2013-0474861E5 - Subparagraph 107.4(3)(a)(i) election

There is currently no prescribed form available for the subparagraph 107.4(3)(a)(i) election. In place of a prescribed form, the transferor trust...

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7 December 2000 External T.I. 2000-0032685 - QUALIFIED DISPOSITION SEGREGATED FUNDS

If a policyholder does not realize any disposition of an interest in a segregated fund contract (viewed as analogous to a capital interest in a...

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Paragraph 107.4(3)(m)

Administrative Policy

2004 Ruling 2003-0053981R3 - XXXXXXXXXX

The Fund, which is an exchange-traded mutual fund trust, will for nominal consideration subscribe for one Trust Unit of a unit trust (the...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - 101-110 - Section 107.4 - Subsection 107.4(1) - Paragraph 107.4(1)(a) qualifying drop-down of partnership units to subsidiary unit trust where s. 107.4(2)(a) was ousted due to units issuance 246
Tax Topics - Income Tax Act - Section 245 - Subsection 245(4) elimination of MFT corporate sub through creation of MFC and 132.2 merger 160
Tax Topics - Income Tax Act - 101-110 - Section 107.4 - Subsection 107.4(1) - Paragraph 107.4(1)(h) immediate refinancing of drop-down subsidiary trust of MFT did not offend policy of para. (h) 234

2003 Ruling 2003-000498C - Qualifying disposition from trust to Sub

On a transfer by a mutual fund trust (the "Fund") of shares and notes of a subsidiary to a subsidiary trust (the "Trust") of the Fund for no...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - 101-110 - Section 107.4 - Subsection 107.4(2) - Paragraph 107.4(2)(a) s. 107.4(2)(a) applies where drop-down by MFT of corporate sub to sub trust for no consideration 245