Subsection 135(1) - Deduction in computing income
Administrative Policy
19 November 2013 External T.I. 2011-0414201E5 F - Coop, ristournes, société de personne
A coop holds an interest in a limited partnership whose members also are members of the coop. For purposes of s. 135, are the customers of the...
22 July 2013 External T.I. 2012-0467231E5 - Patronage dividends and capital gains
Patronage dividends paid to members totalling the amount of taxable capital gains realized by a co-op will be deductible by the co-op pursuant to...
20 September 2005 External T.I. 2005-0140601E5 F - Ristournes - Coop de travailleurs actionnaire
CRA indicated that a shareholder worker co-operative can make payments to its members that will be deductible under s. 135(1), stating:
19 June, 1995 T.I. 950842 (C.T.O. "Patronage of Dividends by Non Co-op"
"Private retailers who are not organized as co-operatives may deduct the amount of patronage dividends paid to customers. Such payment may be made...
13 March 1992 External T.I. 5-920029
Payments made by a credit union to non-members which were similar in nature to allocations in proportions to borrowing and bonus interest payments...
13 March 1992 T.I. (Tax Window, No. 18, p. 7, ¶1804)
A credit union can deduct payments made to non-members which, if made to members, will be deductible under s. 137(2) provided that the payments...
Subsection 135(1.1)
Administrative Policy
25 October 2004 External T.I. 2004-0086261E5 F - Ristournes
After referring to the legislative proposal to add s. 135(1.1) applicable to payments made after March 22, 2004 and related changes to the...
Subsection 135(2) - Limitation where non-member customer
Cases
The Queen v. Consumers' Co-Operative Refineries Ltd., 87 DTC 5409, [1987] 2 CTC 204 (FCA)
The taxpayer paid patronage dividends to its sole member in respect of refined products sold to it but no such payments were made to purchasers of...
Subsection 135(2.1)
Administrative Policy
25 February 2015 External T.I. 2013-0503941E5 F - Priority of subsections 135(2) or 135.1(3)
CRA addressed a numerical example where the cash dividends and patronage dividends paid as tax-deferred cooperative shares for the year were $6...
Subsection 135(3)
Administrative Policy
29 April 2005 External T.I. 2005-0117371E5 F - Ristourne payée à une société de personnes
Regarding the withholding tax treatment of a payment made pursuant to an allocation in proportion to patronage (a "patronage dividend") to a...
12 May 2004 External T.I. 2004-0072951E5 F - Ristournes versées dans un REÉR
Regarding a patronage payment made to an RRSP, CRA stated:
[W]here the person receiving the payment of a patronage dividend under section 135 is a...
Subsection 135(4) - Definitions
Allocation in Proportion to Patronage
Administrative Policy
14 December 2012 External T.I. 2012-0436981E5 F - Ristournes de coopératives de travailleurs
S. 149.5 of the Quebec Cooperatives Act provides for the inclusion in a shareholding workers cooperative’s enhancement reserve of a portion of...
6 October 2005 External T.I. 2005-0146061E5 F - Coop de travailleurs actionnaire - montants versés
After finding that a workers shareholder cooperative qualified as a cooperative corporation within the meaning of s. 136(2), CRA...
19 January 2005 External T.I. 2004-0081001E5 F - Réserve de valorisation d'une coopérative
S. 149.1 of the Quebec Cooperatives Act provided that certain cooperatives could set up an “enhancement reserve” to value the use of the...
17 July 2001 External T.I. 2001-0091015 F - RISTOURNES DE COOPERATIVES DE TRAVAILLEURS
In finding that a worker cooperative could deduct patronage dividends to members, CCRA stated:
[T]he term "customer", for the purposes of section...
19 June 1995 Memorandum 950842 (C.T.O. "Patronage Dividends Paid by Non Co-ops")
"Although it is usually a co-operative that deducts patronage dividends, this deduction is available to any taxpayer who qualifies including sole...
7 June 1993 T.I. (Tax Window, No. 31, p. 23, ¶2549)
The payment by a non-profit housing project for seniors of the excess of the selling price for units over the cost of construction would not...
26 August 1992 T.I. (Tax Window, No. 23, p. 19, ¶2138)
A payor organization will not be considered to have failed to make "allocations in proportion to patronage" by virtue of members waiving their...
Customer
Administrative Policy
29 January 2018 External T.I. 2017-0702731E5 - Patronage dividends and partnerships
Can a cooperative corporation, that is a member of a limited partnership, deduct patronage dividends computed on the basis of sales made by the...
Income of the Taxpayer Attributable to Business Done With Members
Cases
Interprovincial Co-operative Ltd. v. The Queen, 87 DTC 5115, [1987] 1 CTC 222 (FCTD)
It was held that although suppliers shipped to, and billed, members of the co-operative directly, the members acted as agents of the co-operative...
Sedgewick Co-operative Association Ltd. v. The Queen, 83 DTC 5455, [1984] CTC 14 (FCTD)
Since the word "income" in s. 135(4)(d) (and s. 135(2)) is not preceded by the word "business", that "income" is to be calculated on the basis of...
Administrative Policy
29 February 2016 External T.I. 2015-0613961E5 - Patronage dividends - partnership income
Is a cooperative corporation that is a limited partner required to include its share of partnership income in computing its income for s. 135(4)...
Subsection 135(7) - Payment to customer to be included in income
Administrative Policy
9 December 2010 External T.I. 2010-0364001E5 F - Ristourne de consommation, feuillet T4A
In finding that an amount received by virtue of an allocation in respect of "consumer goods or services" as defined in s. 135(4) is not required...
26 August 1992 T.I. (Tax Window, No. 23, p. 19, ¶2138)
A patronage dividend will not be included in the income of a co-operative member if the member unconditionally foregoes her present and future...