Subsection 136(1)
Administrative Policy
12 July 2000 Internal T.I. 2000-0027857 F - PDTPE - COOPÉRATIVE
Regarding whether the members of a cooperative could claim an allowable business investment loss respecting their shares in the cooperative pursuant to s. 50(1), the Directorate noted that such shares could qualify as shares of a Canadian-controlled private corporation, given that a share in a cooperative corporation as defined in s. 136(2) was a share within the meaning of s. 248(1) and that a cooperative corporation was deemed for purposes of s. 39(1)(c) to be a private corporation by virtue of s. 136(1).
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 39 - Subsection 39(1) - Paragraph 39(1)(c) | s. 50(1) ABIL could be claimed on members’ shares of cooperative in reliance on 12-month SBC lookback rule | 289 |
Subsection 136(2)
Administrative Policy
6 October 2005 External T.I. 2005-0146061E5 F - Coop de travailleurs actionnaire - montants versés
Regarding the qualification of a workers shareholder cooperative, CRA stated:
As stated in F9902745 … a workers cooperative provides services to its members where it employs its members directly or indirectly. Consequently, a workers cooperative that satisfies the requirements (a) to (c) of subsection 136(2) may be a cooperative corporation within the meaning of that subsection. The term "indirectly" in that letter refers, inter alia, to a shareholder workers cooperative. Consequently, the presumption in subsection 136(1) would apply to deem the shareholder workers cooperative not to be a "private corporation" for certain purposes of the Act, including for purposes of Part IV tax.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 82 - Subsection 82(1) - Paragraph 82(1)(a) | interest on a preferred share was a dividend | 27 |
| Tax Topics - Income Tax Act - Section 135 - Subsection 135(4) - Allocation in Proportion to Patronage | patronage dividend based on volume of work performed | 108 |
Paragraph 136(2)(c)
Administrative Policy
6 November 2015 External T.I. 2015-0611691E5 F - Member of a cooperative corporation
What is the meaning of “member” for purposes of s. 136(2)(c)? Does the s. 135(4) definition apply? CRA responded:
[T]he preamble to subsection 135(4) states that the definitions in that section apply only for the purposes of section 135 and section 135.1. …
[F]or the purposes of subsection 136(2), the definition of member is determined according to the law under which the cooperative corporation was formed, as well as by the charter, articles or by-laws.
29 May 2001 Internal T.I. 2000-0053257 F - COOPERATIVE
Where an individual ceased being a member of a cooperative (although still owning preferred shares thereof) but became a partner in a partnership, carrying on the business of farming, that is a member of the Cooperative, the Directorate stated:
[T]he preferred shares of the individual non-member would not be shares held by a member who is an individual, another cooperative corporation, or corporation or partnership that carries on the business of farming.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 136 - Subsection 136(2) - Paragraph 136(2)(d) | shares need not be fully paid | 44 |
Paragraph 136(2)(d)
Administrative Policy
29 May 2001 Internal T.I. 2000-0053257 F - COOPERATIVE
The Directorate indicated that shares for purposes of s. 136(2)(d) would include shares that had been subscribed for by the member but not fully paid for, noting that “the QCA does not require payment of the shares at the time of subscription.”
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 136 - Subsection 136(2) - Paragraph 136(2)(c) | non-member individual cannot look through a farming member partnership | 79 |