Cases
Allendale Mutual Insurance Co. v. The Queen, 73 DTC 5382, [1973] CTC 494 (FCTD)
Policy holders, who were members of factory mutual companies, were not entitled to dividends as such, and accordingly were not shareholders.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 87 - Subsection 87(1) | 147 |
Administrative Policy
S3-F2-C1 - Capital Dividends
Shareholder
1.20 The definition of shareholder in subsection 248(1) includes a “person entitled to receive payment of a dividend”. This could be relevant where a dividend, in respect of which an election is to be made under subsection 83(2), is declared to be payable by a corporation on a particular payment date to shareholders of record at the end of an earlier specified date. Provided the corporation elects to have the provisions of subsection 83(2) apply to the full amount of the dividend, a person that was a shareholder of record at the end of the earlier specified date will be entitled to the treatment given to a dividend to which subsection 83(2) applies even if they no longer own the share(s) on the date of payment.
S4-F7-C1 - Amalgamations of Canadian Corporations
1.7 Subsection 248(1) defines a shareholder to include a member or other person entitled to receive a dividend. Therefore, a person can be a shareholder of a corporation even if that person does not own any shares of the corporation. An example would be a policyholder of a mutual insurance corporation. The fact that such a shareholder does not receive any shares of the new corporation because of the amalgamation will not cause the requirement described in [s. 87(1)(c)] not to have been met.
7 November 2013 External T.I. 2013-0473771E5 - Shareholder of a Not-for-profit corporation
In response to a detailed submission to the contrary, CRA maintained its position under the expanded definition of "shareholder"
that members of a non-profit corporation without share capital will be considered shareholders thereof for purposes of subsection 15(1) of the Act, notwithstanding that they are not entitled to receive dividends.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 15 - Subsection 15(1) | NPO member receiving "shareholder" benefit | 57 |
22 November 2012 External T.I. 2012-0441781E5 F - Prohibited Investment - Cooperative
Before concluding that “for the purposes of the Act, a cooperative is a corporation, a share of the capital stock of a cooperative is a share and a member can be a shareholder,” CRA stated:
First, a cooperative is a legal person by virtue of section 3 of the Cooperatives Act, CQLR, c. C-67.2. In addition, under the definition of "corporation" in subsection 248(1), a "corporation" includes such a person. Accordingly, we are of the view that for the purposes of the Act, a cooperative is a corporation. Furthermore, the definition of "share" in subsection 248(1) provides that a share of the capital stock of a corporation includes a share of the capital of a cooperative corporation within the meaning of subsection 136(2). Finally, the definition of "shareholder" in subsection 248(1) includes a member or other person entitled to receive payment of a dividend. Consequently, we are of the view that a member of a cooperative holding a share of the capital stock entitled to receive a dividend is a shareholder for the purposes of the Act.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Regulations - Regulation 4900 - Subsection 4900(15) | application to shares of cooperative | 115 |
| Tax Topics - Income Tax Act - Section 207.01 - Subsection 207.01(1) - Prohibited Investment - Paragraph (b) - Subparagraph (b)(i) | share of cooperative can be a share of corporation for prohibited investment purposes | 71 |