Administrative Policy
18 October 1995 External T.I. 9511155 - DIVIDEND RENTAL
Where a taxable Canadian corporation (the "Borrower") borrows shares of a non-resident public corporation from an arm's length lender and simultaneously acquires an equivalent number of shares of a Canadian public corporation that are exchangeable into shares of the non-resident corporation and that pay an equivalent dividend, paragraph (b) would seem to be applicable.
23 April 1992 Memorandum 921211 (September 1992 Access Letter, p. 39)
A situation in which a securities dealer would borrow a share on which either a cash dividend, or a stock dividend valued at a 5% discount from the market price, was payable, elect to receive the stock dividend, sell the stock dividend upon receipt and pay a dividend compensation amount and a portion of the profit on the transaction to the lender of the share, would be considered a securities lending arrangement, and might also be considered a dividend rental arrangement.
Locations of other summaries | Wordcount | |
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Tax Topics - Income Tax Act - Section 260 - Subsection 260(1) - Securities Lending Arrangement | 82 |
IT-67R3 "Taxable Dividends from Corporations Resident in Canada"
"A dividend rental arrangement ... may generally be described as any arrangement the main reason for which is to enable a person to receive a dividend on a share ... in circumstances where any increase or decrease in the value of the share accrues to someone other than that person."
Locations of other summaries | Wordcount | |
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Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Amount | 8 | |
Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Dividend | 36 |