Section 56.4

Subsection 56.4(1) - Definitions

Eligible Corporation

Administrative Policy

Michael Coburn, "Practical Strategies for Dealing with the Restrictive Covenant Provisions," 2014 Conference Report, (Canadian Tax Foundation), 8:1-29

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Eligible Interest

Administrative Policy

11 October 2013 APFF Roundtable, 2013-0495691C6 F - Clause restrictive

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 56.4 - Subsection 56.4(3) - Paragraph 56.4(3)(c) non-solicitation clause/divergence of covenanter and seller 360
Tax Topics - Income Tax Act - Section 56.4 - Subsection 56.4(7) - Paragraph 56.4(7)(b) non-solicitation clause could be treated as part of a non-compete 153
Tax Topics - Income Tax Act - Section 56.4 - Subsection 56.4(7) - Paragraph 56.4(7)(f) maintenance of Holdco fmv/divergence of seller and covenanter 233

Articles

Mark Woltersdorf, "Restrictive Covenants – The Final Chapter (For Now) – Part I", CCH Tax Topics, No. 2132, 17 January 2013, p. 1 at p. 3

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Restrictive Covenant

Administrative Policy

16 August 2017 Internal T.I. 2017-0701291I7 - Exclusive Distributorship Rights

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 212 - Subsection 212(1) - Paragraph 212(1)(d) - Subparagraph 212(1)(d)(i) Farmparts likely excluded application to product distributorship right/product name on product not a valuable use of trademark 477
Tax Topics - Income Tax Act - Section 212 - Subsection 212(1) - Paragraph 212(1)(d) lump sum non-contingent payment for distributorship right was not a royalty 99
Tax Topics - Income Tax Act - Section 212 - Subsection 212(1) - Paragraph 212(1)(i) a lump sum paid to a non-resident for granting an exclusive right to distribute its product in Canada was subject to s. 212(1)(i) withholding 199
Tax Topics - Treaties - Income Tax Conventions - Article 12 lump sum paid for distributorship rights was not a royalty 231

20 November 2014 Internal T.I. 2014-0539631I7 - Restrictive Covenants-Part XIII (Luxembourg)

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Locations of other summaries Wordcount
Tax Topics - Treaties - Income Tax Conventions - Article 22 restrictive covenant payment not eligible for relief under Lux Treaty 256
Tax Topics - Treaties - Income Tax Conventions - Article 7 restrictive covenant payment not eligible for relief under Lux Treaty 138

Articles

Sze Yee Ling, Nathan Wright, "Restrictive Covenants: Some Reminders", Canadian Tax Focus, Vol. 7, No. 1, February 2017, p. 7

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Michael Coburn, "Practical Strategies for Dealing with the Restrictive Covenant Provisions", 2014 Conference Report (Canadian Tax Foundation), 8:1-29

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Subsection 56.4(2) - Income — restrictive covenants

Administrative Policy

16 February 2016 External T.I. 2015-0618601E5 - Earned or Unearned Revenue

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 12 - Subsection 12(1) - Paragraph 12(1)(x) lump sum received on signing 15-year supplier loyalty agreement was immediately recognized inducement 194
Tax Topics - Income Tax Act - Section 20 - Subsection 20(1) - Paragraph 20(1)(m) no deferral for amount included under s. 56.4(2) or 12(1)(x) 120

Articles

Michael Coburn, "Practical Strategies for Dealing with the Restrictive Covenant Provisions", 2014 Conference Report (Canadian Tax Foundation), 8:1-29

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Julie A. Colden, "Restrictive Covenant Update", Canadian Current Tax, Vol. 15, No. 11, August 2005, p. 97.

Nathan Boidman, Michael Kandev, "Controversies in Canada Respecting the Taxation of Non-Competition and Related Payments", Bulletin for International Fiscal Documentation, Vol. 58, No. 10, October 2004, p. 494.

Subsection 56.4(3) - Non-application of subsection (2)

Paragraph 56.4(3)(b)

Articles

Michael Coburn, "Practical Strategies for Dealing with the Restrictive Covenant Provisions", 2014 Conference Report (Canadian Tax Foundation), 8:1-29

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Paragraph 56.4(3)(c)

Administrative Policy

22 August 2017 Internal T.I. 2017-0688301I7 - Restrictive Covenant

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 56.4 - Subsection 56.4(7) - Paragraph 56.4(7)(b) non-solicitation covenant included in non-compete 183

11 October 2013 APFF Roundtable, 2013-0495691C6 F - Clause restrictive

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 56.4 - Subsection 56.4(1) - Eligible Interest must be one, rather than more than one, underlying corp 88
Tax Topics - Income Tax Act - Section 56.4 - Subsection 56.4(7) - Paragraph 56.4(7)(b) non-solicitation clause could be treated as part of a non-compete 153
Tax Topics - Income Tax Act - Section 56.4 - Subsection 56.4(7) - Paragraph 56.4(7)(f) maintenance of Holdco fmv/divergence of seller and covenanter 233

Subsection 56.4(6) - Application of subsection (5) — if employee provides covenant

Articles

Kenneth Keung, Riaz S. Mohamed, "Restrictive Covenants for Departing Executives", Taxation of Executive Compensation and Retirement (Federated Press), Vol. 23 No. 4, November 2012, p. 1604.

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Mark Woltersdorf, "Restrictive Covenants – The Final Chapter (For Now) – Part II", CCH Tax Topics, No. 2135, 7 February 2013, p. 1 at p. 4:

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Paragraph 56.4(6)(e)

Administrative Policy

2 December 2014 CTF Roundtable Q. 3, 2014-0547251C6 - Q.3 - Restrictive Covenants

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16 June 2014 STEP Roundtable, 2014-0522961C6 - STEP CRA Roundtable - June 2014

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 56.4 - Subsection 56.4(7) - Paragraph 56.4(7)(d) nominal consideration tainting of non-compete 157

Subsection 56.4(7) - Application of subsection (5) — realization of goodwill amount and disposition of property

Paragraph 56.4(7)(b)

Administrative Policy

22 August 2017 Internal T.I. 2017-0688301I7 - Restrictive Covenant

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 56.4 - Subsection 56.4(3) - Paragraph 56.4(3)(c) agreement not to solicit employees not assimilated 198

11 October 2013 APFF Roundtable, 2013-0495691C6 F - Clause restrictive

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 56.4 - Subsection 56.4(1) - Eligible Interest must be one, rather than more than one, underlying corp 88
Tax Topics - Income Tax Act - Section 56.4 - Subsection 56.4(3) - Paragraph 56.4(3)(c) non-solicitation clause/divergence of covenanter and seller 360
Tax Topics - Income Tax Act - Section 56.4 - Subsection 56.4(7) - Paragraph 56.4(7)(f) maintenance of Holdco fmv/divergence of seller and covenanter 233

Articles

Michael Coburn, "Practical Strategies for Dealing with the Restrictive Covenant Provisions", 2014 Conference Report (Canadian Tax Foundation), 8:1-29

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Manu Kakkar, "Paragraph 56.4(7)(b ) Related-Person Problem and Arm's Length Minority Acquisitions", Tax For The Owner-Manager, Volume 14, Number 2, April 2014, p. 8.

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Manu Kakkar, "Section 56.4 Restricted Covenant Trap", Tax for the Owner-Manager, Volume 13, Number 4, October 2013, p. 4:

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Paragraph 56.4(7)(d)

Administrative Policy

16 June 2014 STEP Roundtable, 2014-0522961C6 - STEP CRA Roundtable - June 2014

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 56.4 - Subsection 56.4(6) - Paragraph 56.4(6)(e) nominal consideration tainting of non-compete - partly reversed immediately above 157

Articles

Michael Coburn, "Practical Strategies for Dealing with the Restrictive Covenant Provisions", 2014 Conference Report (Canadian Tax Foundation), 8:1-29

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Paragraph 56.4(7)(e)

Articles

Michael Coburn, "Practical Strategies for Dealing with the Restrictive Covenant Provisions", 2014 Conference Report (Canadian Tax Foundation), 8:1-29

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Paragraph 56.4(7)(f)

Administrative Policy

11 October 2013 APFF Roundtable, 2013-0495691C6 F - Clause restrictive

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 56.4 - Subsection 56.4(1) - Eligible Interest must be one, rather than more than one, underlying corp 88
Tax Topics - Income Tax Act - Section 56.4 - Subsection 56.4(3) - Paragraph 56.4(3)(c) non-solicitation clause/divergence of covenanter and seller 360
Tax Topics - Income Tax Act - Section 56.4 - Subsection 56.4(7) - Paragraph 56.4(7)(b) non-solicitation clause could be treated as part of a non-compete 153

Subsection 56.4(12) - Clarification if subsection (5) applies

Articles

Mark Woltersdorf, "Restrictive Covenants – The Final Chapter (For Now) – Part II", CCH Tax Topics, No. 2135, 7 February 2013, p. 1 at pp. 3-4:

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