The settlor of an inter vivos trust is entitled to receive all the trust income during his or her lifetime and, if survived by his or her spouse or common-law partner, such spouse or partner is entitled to all such income until death. Does this trust satisfy the requirement that the settlor and spouse/partner be "entitled" in "combination with the other" to receive all the trust income. CRA stated:
[I]f the terms of the trust provide that the taxpayer who transferred property to the trust was entitled to receive all of the income of the trust during his or her lifetime and the surviving spouse or common-law partner was only entitled to receive the trust's income after the death of the taxpayer and no other person could, before the later of those deaths receive or otherwise obtain the use of any of the income or capital of the trust, this in and of itself, would not prevent the trust from qualifying as a "joint spousal or common-law partner trust".
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|Tax Topics - Income Tax Act - Section 73 - Subsection 73(1.01) - Paragraph 73(1.01)(c)||"combination" requirement satisfied where predeceased spouse||177|