Subsection 69(1) - Inadequate considerations
Paragraph 69(1)(a)
Cases
Tusk Exploration Ltd. v. Canada, 2018 FCA 121
The taxpayer, a Canadian exploration company, unsuccessfully argued that it was not subject to Part XII.6 tax on Canadian exploration expenses...
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| Tax Topics - Income Tax Act - Section 211.91 - Subsection 211.91(1) | Part XII.6 tax was payable on CEE purportedly renounced on a look-back basis to NAL shareholders | 515 |
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(28) | potential for double taxation under the ITA of NAL transactions | 307 |
| Tax Topics - Income Tax Act - Section 66 - Subsection 66(12.6) | only a PBC can renounce | 61 |
Survivance v. Canada, 2007 DTC 5096, 2006 FCA 129
Before going on to find that it followed from the deeming in subsection 256(9) of control of a corporation to be acquired as of the beginning of...
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|---|---|---|
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Disposition | no disposition until payment | 94 |
| Tax Topics - Income Tax Act - Section 256 - Subsection 256(9) | 94 | |
| Tax Topics - Statutory Interpretation - Interpretation/Definition Provisions | deemed acquisition of control implied loss of control | 45 |
Deptuck v. Canada, 2003 DTC 5273, 2003 FCA 177
S.69(1)(a) applied to reduce the capital cost to a partnership of depreciable property purchased by it to the property's fair market value rather...
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| Tax Topics - Income Tax Act - Section 251 - Subsection 251(1) - Paragraph 251(1)(c) | common control at time of purchase by GP - LPs came in later | 101 |
| Tax Topics - Income Tax Act - Section 96 - Subsection 96(1) - Paragraph 96(1)(c) | 115 |
Chutka v. Canada, 2001 DTC 5093 (FCA)
A sale of equipment by a corporation to a partnership whose general partner was wholly-owned by the same individual who owned the vendor...
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|---|---|---|
| Tax Topics - Income Tax Act - Section 251 - Subsection 251(2) - Paragraph 251(2)(c) - Subparagraph 251(2)(c)(i) | 138 | |
| Tax Topics - Income Tax Act - Section 96 - Subsection 96(1) - Paragraph 96(1)(g) | sale to partnership with non-arm's length general partner was non-arm's length transaction | 138 |
Ottawa Valley Power Co. v. MNR, 69 DTC 5166, [1969] CTC 242 (Ex Ct), aff'd 70 DTC 6223, [1970] CTC 305, [1970] S.C.R. 941
In finding that improvements which Ontario Hydro made free of charge to the plant of the taxpayer in order that the taxpayer could provide 60...
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| Tax Topics - Income Tax Act - Section 13 - Subsection 13(7.1) | no application to ordinary business arrangements | 135 |
See Also
The Queen v. Yelle, 2010 DTC 5128 [at 7083], 2010 ABPC 94
The taxpayer, who was a member of a partnership, was accused tax evasion under s. 239(1)(a) in connection with capital cost allowance claims made...
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|---|---|---|
| Tax Topics - Income Tax Act - Section 13 - Subsection 13(21) - Undepreciated Capital Cost - A | 155 | |
| Tax Topics - Income Tax Act - Section 251 - Subsection 251(1) - Paragraph 251(1)(c) | time of dealing is relevant time | 127 |
Heron Bay Investments Ltd. v. The Queen, 2009 DTC 1606, 2009 DTC 1288
Hogan, J. indicated that if he accepted the taxpayer's evidence that a loan made by the taxpayer on a non-recourse basis to a related corporation...
Westward Explorations Ltd. v. The Queen, 2006 DTC 2443, 2006 TCC 105
An 11.12% interest in a gold mine that the taxpayer purchased was to be valued, for purposes of s. 69(1)(a) of the Act, on the basis that the...
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|---|---|---|
| Tax Topics - General Concepts - Fair Market Value - Other | 78 |
CIT Financial Ltd. v. The Queen, 2003 DTC 1138, 2003 TCC 544
The fair market value of custom software that a New Zealand company had developed to run its steel mill was found to have a fair market value...
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|---|---|---|
| Tax Topics - General Concepts - Fair Market Value - Other | 88 | |
| Tax Topics - Income Tax Act - Section 245 - Subsection 245(2) | specific provisons applied before GAAR | 57 |
Pat Marcantonio v. Minister of National Revenue, 91 DTC 917, [1991] 1 CTC 2702 (TCC)
The taxpayer, an optometrist, sold lenses and frames which he, in turn, had purchased essentially at the same price from a related corporation...
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| Tax Topics - Income Tax Act - Section 248 - Subsection 248(28) | 79 |
Administrative Policy
28 July 2014 External T.I. 2014-0532651E5 - Loan to charitable foundation
Canco advances the Loan to a related charitable foundation. The Loan is not issued at a discount and matures in X years. Are there any tax...
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| Tax Topics - Income Tax Regulations - Regulation 7000 - Subsection 7000(2) - Paragraph 7000(2)(a) | non-interest bearing and non-arm's length term loan could trigger PDO rules | 162 |
S4-F3-C1 - Price Adjustment Clauses
CRA will consider a price adjustment clause to represent pricing at fair market value if:
- the agreement reflects a bona fide intention of the...
8 October 2010 Roundtable, 2010-0373371C6 F - Souscription des unités d'une SEC
The 100 units of a limited partnership (LP), which on an FMV basis has a deficit of $108,000 (i.e., liabilities of $110,000 and assets of $2,000),...
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| Tax Topics - Income Tax Act - Section 53 - Subsection 53(1) - Paragraph 53(1)(e) - Subparagraph 53(1)(e)(iv) | subscription for units of an underwater LP represented a contribution of capital | 277 |
8 January 2002 Internal T.I. 2001-0097357 - Cost of property acquired from a NAL person
Where Mr. A sold shares of Opco to a son and daughter in consideration for promissory notes that were non-interest bearing and repayable in annual...
10 January 1992 CGA Roundtable, Q. 19, 7-912224
Where shares are issued by a corporation on the conversion of debt owed by the corporation to a non-arm's length shareholder, the value of the...
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| Tax Topics - Income Tax Act - 101-110 - Section 110.6 - Subsection 110.6(7) | 54 | |
| Tax Topics - Income Tax Act - Section 55 - Subsection 55(3) - Paragraph 55(3)(a) | 70 | |
| Tax Topics - Income Tax Act - Section 53 - Subsection 53(1) - Paragraph 53(1)(c) | contribution of capital on conversion of debt to lower FMV shares | 198 |
8 November 1990 T.I. (Tax Window, Prelim. No. 2, p. 10, ¶1046)
Ss.69(1)(a) and 80(1) both will be applied where a creditor accepts low fair market value shares in satisfaction of the debt previously owing to it.
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| Tax Topics - Income Tax Act - Section 80 - Subsection 80(1) | 27 | |
| Tax Topics - Income Tax Act - Section 80 - Subsection 80(5) | 27 |
87 C.R. - Q.68 (p. 47:38)
Where additional shares of an insolvent corporation are acquired by the taxpayer, any cost basis denied by s. 69(1)(a) may be treated as a...
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| Tax Topics - Income Tax Act - Section 53 - Subsection 53(1) - Paragraph 53(1)(c) | cost denied by 69(1)(a) treated as contribution of capital | 143 |
81 C.R. - Q.3
When a shareholder advance is paid off with the proceeds of a day-light loan and the proceeds are then used by the shareholder to subscribe for...
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| Tax Topics - Income Tax Act - Section 248 - Subsection 248(28) | 20 |
IT-405 "Inadequate Considerations and Dispositions"
Paragraph 69(1)(b)
Cases
Des Groseillers v. Quebec (Agence du revenu), 2022 SCC 42
An individual who donated some of his employee stock options on the shares of a public company to arm's length registered charities, claimed the...
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| Tax Topics - Income Tax Act - Section 7 - Subsection 7(3) - Paragraph 7(3)(a) | s. 7(3)(a) does not override s. 69(1)(b) | 274 |
Bouchard v. The Queen, 83 DTC 5193, [1983] CTC 173 (FCTD)
S.69(1)(b)(i) did not apply to a transfer of land by the taxpayer to his son and daughter-in-law where they already had the beneficial ownership...
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| Tax Topics - General Concepts - Effective Date | parol trust over land has effect for tax purposes from its formation - at least, if subsequently confirmed in writing | 160 |
| Tax Topics - General Concepts - Evidence | 74 | |
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(2) | 78 | |
| Tax Topics - Income Tax Act - Section 6 - Subsection 6(1) - Paragraph 6(1)(e) | 70 |
See Also
0808414 B.C. Ltd. v. The King, 2024 TCC 99
The taxpayer, which carried on the business of manufacturing, marketing and distributing ready-to-eat cereal products under the brand name...
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| Tax Topics - General Concepts - Fair Market Value - Other | FMV of equipment was not limited by the FMV of the business as a going concern | 222 |
Lauria v. The Queen, 2021 TCC 66
On April 1, 2006, the taxpayers, who were executives of Gluskin Sheff+Associates Inc. (“GS+A”) (but with less clout than the founders), sold a...
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| Tax Topics - General Concepts - Fair Market Value - Shares | shares transferred 3 weeks prior to filing the IPO preliminary valued at a 40% “marketability” discount to the IPO value | 373 |
| Tax Topics - Income Tax Act - Section 152 - Subsection 152(4) - Paragraph 152(4)(a) - Subparagraph 152(4)(a)(i) | sophisticated taxpayers were careless in not valuing shares at a value reflecting an imminent IPO | 613 |
Agence du revenu du Québec v. Des Groseillers, 2021 QCCA 906, aff'd 2022 SCC 42
An individual who donated some of his employee stock options on the shares of a public company to arm's length registered charities, claimed...
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| Tax Topics - Income Tax Act - Section 7 - Subsection 7(3) - Paragraph 7(3)(a) | s. 7(3)(a) accords precedence of s. 7 over ss. 5 and 6, but not over s. 69 computation rules | 326 |
Godcharles v. Agence du revenu du Québec, 2020 QCCQ 2219, aff'd 2021 QCCA 1843
A retirement home was co-owned by eight individuals and operated by a corporation of which they were the shareholders. The home and operating...
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| Tax Topics - Income Tax Act - Section 251 - Subsection 251(1) - Paragraph 251(1)(c) | a sale of goodwill occurred between parties acting in concert given the role of a dominant player | 410 |
| Tax Topics - General Concepts - Fair Market Value - Land | retirement home valued using cost method with residual to goodwill | 127 |
DMWSHNZ Ltd. v. Commissioners for Her Majesty's Revenue and Customs, [2015] BTC 32, [2015] EWCA Civ 1036
The taxpayer, which had been issued 10-year floating-rate notes on its sale of shares of a New Zealand subsidiary to a third party, subsequently...
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| Tax Topics - Statutory Interpretation - Purpose | purposive approach entails checking whether overall effect of transaction answers the statutory description | 173 |
Shepp v. The Queen, 99 DTC 510, [1999] 1 CTC 2889 (TCC)
In obiter dicta, Lamarre Proulx TCJ. doubted that s. 69(1)(b) could be applied on the basis that there was a disposition of an "economic interest"...
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| Tax Topics - General Concepts - Fair Market Value - Shares | 103 |
Gee-Gee Investments Ltd. v. MNR, 94 DTC 1419, [1994] 1 CTC 2707 (TCC)
The date at which a residence was to be valued for purposes of determining the capital gain realized by the taxpayer with respect to the transfer...
Berry v. Warnett, [1980] T.R. 299 (C.A.), rev'd [1980] BTC 239 (HL)
"[T]he ordinary primary meaning of 'gift' is a voluntary transfer of property made without consideration."
The Queen v. Littler, 78 DTC 6179, [1978] CTC 235 (FCA)
A sale by the taxpayer to his sons of shares for their market price at a time when the taxpayer had insider knowledge that an offer would be made...
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| Tax Topics - Other Legislation/Constitution - Federal - Federal Courts Rules - Rule 408(1) | 107 | |
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Property | 26 |
Administrative Policy
2021 Ruling 2020-0862431R3 F - Variation of a trust deed and addition of new beneficiaries
A trust deed for a family trust (whose current named beneficiaries were family individuals) was to be amended by court order to expand the range...
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| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Disposition | trust deed amendment by court order to permit addition of corporations that were only indirectly owned by family beneficiaries did not trigger a disposition/ such addition triggered disposition of trust interests but without proceeds | 444 |
7 October 2016 APFF Roundtable Q. 19, 2016-0655841C6 F - Reimbursement of attributed income
CRA assesses corporation A under s. 56(2) and s. 69(1)(b) on a capital gain of $99,990 on the basis that it had exchanged preferred shares with a...
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| Tax Topics - Income Tax Act - 101-110 - Section 103 - Subsection 103(1) | no obligation to repay income reallocated to other partner | 170 |
| Tax Topics - Income Tax Act - Section 74.1 - Subsection 74.1(1) | no domestic secondary adjustment doctrine | 218 |
3 March 2015 External T.I. 2014-0519981E5 F - Donation avec charge / Gift with a charge
An individual donates a real estate property with a fair market value of $200,000 that is charged with a hypothec of $100,000. After noting that...
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| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Property | real estate property is one property | 75 |
25 October 2013 External T.I. 2013-0484321E5 F - Donation entre vifs / inter vivos gift
Does s. 69(1)(b)(ii) apply only to individuals? CRA indicated that the interpretation of the term "gift inter vivos" is not a tax issue but a...
6 August 2013 External T.I. 2012-0469481E5 F - Benefit under trust
An estate sold personal-use real estate to one of its beneficiaries for a price less than the property's fair market value, so that s. 69(1)(b)(i)...
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| Tax Topics - Income Tax Act - 101-110 - Section 105 - Subsection 105(1) | taxable benefit on sale to beneficiary at undervalue was not eliminated under s. 105(1)(a) when beneficiary sold the property | 132 |
| Tax Topics - Income Tax Act - Section 52 - Subsection 52(1) | benefit on estate sale to beneficiary at under-value added to property's ACB | 133 |
23 April 2013 Internal T.I. 2012-0466081I7 F - Usufruct created under French legislation
A Canadian-resident taxpayer who lived outside Canada made a transfer without consideration (the "Gift") to her adult children of a building and...
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| Tax Topics - Income Tax Act - Section 43.1 | gift of immovable subject to reservation of a usufruct gave rise to a disposition under s. 43.1 | 282 |
| Tax Topics - General Concepts - Foreign Law | 2-step approach to characterizing a French civil law transaction | 244 |
31 May 2012 External T.I. 2011-0426091E5 - 98(5) - ptnsp's leasehold int if ptnr is lessor
A partnership was leasing property from a partner, and then is wound up as described in s. 98(5), with the former partner continuing to use the...
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| Tax Topics - Income Tax Act - Section 98 - Subsection 98(5) | 89 |
3 July 2012 Internal T.I. 2012-0450821I7 F - Interaction of 84(3) and 69(1)(b)
A CCPC ("Opco"), whose voting common shares were owned by two individuals (B and R) and by a Canadian-controlled private corporation ("M Holdco")...
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| Tax Topics - Income Tax Act - Section 84 - Subsection 84(3) | s. 84(3) deemed dividend based on actual redemption proceeds rather than s. 69 | 245 |
12 August 2010 External T.I. 2010-0370991E5 - Debt forgiveness
Corporation A, an operating company, lent money to Corporation B, its holding company which Corporation B used to purchase a building. ...
19 May 2010 External T.I. 2010-0364131E5 F - Issuance - Discretionary shares
Upon the incorporation of Opco, X subscribed for and continued thereafter to hold all the Class A voting participating shares of Opco, whose terms...
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| Tax Topics - Income Tax Act - Section 15 - Subsection 15(1) | subscription for discretionary shares of Opco might represent a s. 15(1) benefit conferred by Opco on subscriber, or engage s. 69(1)(b) where this is benefit conferred by existing shareholder | 203 |
| Tax Topics - Income Tax Act - Section 74.1 - Subsection 74.1(1) | application of Kiebom to consider interest in corp to have been transferred to spouse could engage s. 74.1(1) | 221 |
16 December 2008 External T.I. 2008-0279741E5 F - Renonciation au capital d'une fiducie
CRA indicated that the renunciation of a capital interest in a discretionary family trust would give rise to nil proceeds of disposition, stating...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 75 - Subsection 75(2) | settlor’s valid renunciation of capital interest (but not income interest) prior to trustees’ exercise of discretion to distribute a capital gain would avoid application of s. 75(2)(a)(i) | 199 |
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(9) - Disclaimer | legally impossible for a beneficiary of a discretionary trust to partially renounce income from a specific trust property | 262 |
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Disposition - Paragraph (i) | non-disposition distribution of non-taxable portion of trust capital gains avoids a gain under s. 107(2.1) | 375 |
| Tax Topics - Income Tax Act - Section 54 - Proceeds of Disposition | settlor’s renunciation of capital interest (but not income interest) prior to trustees’ exercise of discretion to distribute a capital gain would generate nil proceeds and not engage s. 56(2) or (4) | 194 |
| Tax Topics - Income Tax Act - Section 56 - Subsection 56(2) | s. 56(2) inapplicable to renunciation of capital interest in a trust | 45 |
| Tax Topics - Income Tax Act - Section 56 - Subsection 56(4) | s. 56(4) inapplicable to disclaimer of capital interest in a trust | 43 |
20 November 2008 Internal T.I. 2008-0281411I7 - Addition of Beneficiaries
The sole trustee (the Trustee) of a family trust who also was one of the "Existing Beneficiaries" exercised a power under the Trust Indenture to...
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| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Disposition | addition of unrelated beneficiaries | 298 |
26 January 2007 External T.I. 2005-0157751E5 F - Don d'un duplex et changement d'usage
Mrs. X, who owned a duplex, 2/3 of which was her principal residence and 1/3 of which was rented to a third party, made a gift of the duplex to...
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|---|---|---|
| Tax Topics - Income Tax Act - Section 13 - Subsection 13(7) - Paragraph 13(7)(b) | 1/2 step-up limitation where change of use | 215 |
31 December 2004 Internal T.I. 2004-0091781I7 - Redemption for Proceeds Less than FMV
Our position is that where, in a non-arm's-length situation, the fair market value of the shares exceeds the redemption amount, the difference...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 84 - Subsection 84(3) | 94 |
9 May 2007 External T.I. 2006-0189931E5 F - Renonciation à une fiducie par un conjoint
What are the tax consequences of the renunciation by the beneficiary of a testamentary spousal trust of all entitlements under the trust (other...
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| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Disposition | extinguishment of trust interests on their renunciation is a disposition of the renounced interest, but resulting variation of trust to accelerate distribution entitlements is not | 167 |
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(4) - Paragraph 104(4)(a) | variation of spousal trust, following renunciation by spouse, to accelerate distribution entitlement of residuary beneficiaries would not engage s. 104(4) until distribution | 195 |
| Tax Topics - Income Tax Act - Section 70 - Subsection 70(6) | variation of spousal trust, following renunciation by spouse, to accelerate distribution entitlement of residuary beneficiaries would not deny s. 70(6) rollover | 211 |
8 October 2004 APFF Roundtable Q. 15, 2004-0086821C6 F - Interaction of 84(3) and 69(1)(b)
Respecting the situation where a subsidiary purchases for cancellation a portion of the common shares in its capital held by its wholly-owning...
14 September 2004 External T.I. 2004-008220
When asked whether the demolition of a rental property would trigger a disposition at fair market value, the Directorate indicated that the...
23 December 2003 External T.I. 2003-0008145 F - TRANSFERT ENTRE EX-CONJOINT
CCRA noted that if a spouse elected out of the application of s. 73(1) to the transfer of property to her divorced husband pursuant to an...
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|---|---|---|
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(23) | deemed transfer to spouse before divorce where property was subject to matrimonial regime to which s. 248(3) applied, so that no need to rely on being in settlement of matrimonial rights | 258 |
| Tax Topics - Income Tax Act - Section 73 - Subsection 73(1.01) - Paragraph 73(1.01)(b) | property transferred in settlement of rights arising out of marriage also includes property transferred in settlement of rights arising out of a matrimonial regime | 278 |
16 December 2003 Internal T.I. 2003-0046167 F - Section 50- Shares of Insolvent Corporation50(1)
Parentco elected under s. 50(1) respecting its shares of one of a wholly-owned subsidiary ("Lossco") with non-capital loses but no assets or...
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|---|---|---|
| Tax Topics - Income Tax Act - Section 50 - Subsection 50(1) - Paragraph 50(1)(b) - Subparagraph 50(1)(b)(iii) | corporation not insolvent if affiliates intend to pay its creditors, and its shares have value if it has non-capital losses | 264 |
| Tax Topics - General Concepts - Fair Market Value - Shares | shares of corporation that had ceased business and had no assets but had non-capital losses had a significant value | 75 |
1 April 2003 External T.I. 2003-0004125 F - Freeze by Paying a Stock Dividend
A CCPC (Opco) paid a stock dividend of preferred shares with a fair market value of $800,00 and a paid-up capital of $80 to its sole shareholder,...
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|---|---|---|
| Tax Topics - Income Tax Act - Section 74.4 - Subsection 74.4(2) | non-application to stock dividend | 108 |
| Tax Topics - Income Tax Act - Section 15 - Subsection 15(1.1) | s. 15(1.1) inapplicable to stock dividend paid to wholly-owning shareholder | 98 |
| Tax Topics - General Concepts - Effective Date | price-adjustment clause to redemption value of preferred shares did not accord with IT-169 | 183 |
11 March 2003 External T.I. 2002-0179095 F - Issuance-Discretionary Shares non-Consid.
A and B, who were the equal common shareholders of Opco, each had personal holding companies (Holdco A and B) form an equally owned holding...
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|---|---|---|
| Tax Topics - Income Tax Act - Section 15 - Subsection 15(1) | a benefit can be conferred on a taxpayer even where no net economic benefit | 213 |
| Tax Topics - Income Tax Act - Section 56 - Subsection 56(2) | s. 56(2) inapplicable to discretionary-dividend shares | 217 |
14 February 2003 External T.I. 2002-0173195 F - Transfer of Shares
Mr. X, who wholly-owned Canco, gifts, at a time that he is withdrawing from Canco’s management, 51% of his shares to his son (Mr. Y), who is a...
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|---|---|---|
| Tax Topics - Income Tax Act - Section 6 - Subsection 6(1) - Paragraph 6(1)(a) | s. 6(1)(a) generally applicable to gift of shares by majority owner to key employee, but not to employee son | 97 |
2001 Ruling 2001-0070943 - PARTNERSHIP INTEREST PENSION CORP.
Although the issue is not referred to, the disposition of property by a corporation pursuant to the exercise of an option by a partnership of...
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|---|---|---|
| Tax Topics - Income Tax Act - Section 253.1 | 48 | |
| Tax Topics - Income Tax Act - Section 97 - Subsection 97(2) | question of fact whether post-drop-down loan is boot | 81 |
10 May 2001 Internal T.I. 2001-0066107 F - TABLE RONDE - QUESTION 32
A taxpayer disposes of depreciable property, having a UCC and capital cost to him of $300,000 and $400,000, respectively, to his son for a sale...
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|---|---|---|
| Tax Topics - Income Tax Act - Section 39 - Subsection 39(1) - Paragraph 39(1)(a) | parenthetical exclusion prevents double taxation to a NAL transferee otherwise arising from the deemed high capital cost under s. 13(7)(e)(iii) but with no ACB step-up under s. 69(1)(b) | 125 |
2000 Ruling 2000-002395
A vertical merger between a US corporation with a Canadian branch business ("Absorbco") and its US parent ("Subco 3") under which Absorbco...
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|---|---|---|
| Tax Topics - Income Tax Act - Section 87 - Subsection 87(8.1) | 71 |
17 April 2000 External T.I. 1999-0009285 - RIGHT TO USE PROPERTY
S.69(1)(b) could apply to the granting of a non-exclusive licence of intellectual property to a related person.
14 January 1999 External T.I. 9828555 - CHANGE TO DIVIDEND RATE
Where shares bearing a non-cumulative dividend of 10% are exchanged on an s. 86 reorganization for shares bearing a non-cumulative dividend of...
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| Tax Topics - Income Tax Act - Section 15 - Subsection 15(1) | 54 |
6 November 1997 External T.I. 9728755 - BENEFIT CONFERRED ON ISSUANCE OF SHARES
An individual shareholder ("A") owns 20 preferred shares of a CCPC ("Opco") having a fair market value of $20 and an unrelated individual ("B"),...
14 November 1996 External T.I. 9635535 - TAX CONSEQUENCES RE EMPLOYEE STOCK OPTIONS
In a response to several questions concerning the tax consequences to both the employee and the non-arm's length transferee where the transferee...
12 April 1994 External T.I. 9402315 - INTELLECTUAL PROPERTY
S.69(1)(b) would apply where a parent corporation owns patents, trademarks and copyright used exclusively by one of its subsidiaries in the...
93 C.R. - Q. 39
If a person enters into an agreement of purchase and sale (or an option) with a person with whom he does not deal at arm's length on fair market...
Revenue Canada Round Table TEI Conference, 7 December 1993, Q. 9 (C.T.O. "Non-Arm's-Length Purchase and Sale Arrangement")
Where there is an extended delay between the date a non-arm's agreement is entered into and the closing of the agreement, RC generally would...
8 December 1993 Income Tax Severed Letter 9333680 - Option Agreements—Non-arm's length Situations
Where a company acquires from a person with whom it does not deal at arm's length an option to acquire property at a fixed price, s. 69(1)(b)...
26 January 1993 T.I. 923284 (November 1993 Access Letter, p. 512, ¶C245-051; Tax Window, No. 28, p. 1, ¶2383)
S.69(1)(b) does not apply to the provision of services for less than their fair market value.
92 C.R. - Q.21
S.69(1)(b)(i) will apply to a transfer of ownership of equity in a corporation in circumstances such as those in The Queen v. Kieboom, 93 DTC 6382...
17 February 1992 T.I. (Tax Window, No. 16, p. 21, ¶1752)
A conveyance will not be precluded from being considered a gift by the payment by the donee of $1 as a legal formality.
30 November 1991 Round Table (4M0462), Q. 3.3 - Issuing of Shares: Consideration Less than the F.M.V. (C.T.O. September 1994)
Where a corporation that has two unrelated shareholders (Mr. A and Mrs. B) each holding one share, issues a third common share for nominal...
18 December 1989 T.I. (May 1990 Access Letter, ¶1219)
s. 69(1)(b) will apply to a purchase for cancellation of shares held by a non-arm's length shareholder for a purchase price less than fair market...
86 C.R. - Q.23
The existence of a fixed price in a buy-sell agreement is not conclusive that the shareholders were not dealing at arm's length.
85 C.R. - Q.9
"Anything" includes intangible property, such as the right to use property. For example, s. 69(1) will apply where an individual rents farmland to...
Articles
Marie Emmanuelle Vaillancourt, Alan Shragie, "Non-Arm's Length Stock Options Transfers", CCH Tax Topics, No. 1985, 25 March 2010, p. 1.
Innes, "If the Tax Treatment of Accrued Gains on Inventory at Death", Estates and Trust Journal, Vol. 12, 1992, p. 122.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 70 - Subsection 70(2) | 0 |
Subparagraph 69(1)(b)(i)
See Also
Godcharles v. Agence du revenu du Québec, 2021 QCCA 1843
A group of unrelated individuals were the co-owners of a seniors’ residence, which was leased by them to the corporate operator of the residence...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 68 - Paragraph 68(a) | s. 68 reallocated between a retirement home’s business operations sold by one vendor and the home sold by the other vendors | 424 |
| Tax Topics - Income Tax Act - Section 251 - Subsection 251(1) - Paragraph 251(1)(c) | transaction was not at arm’s length given the dominant role of their architect | 413 |
| Tax Topics - General Concepts - Fair Market Value - Land | goodwill portion of retirement residences business determined as the residual from valuing the residence using the cost method | 272 |
Mady v. The Queen, 2017 TCC 112
On the same day as the taxpayer and (as described below) his family members closed the sale of the shares of his dental corporation (“MDPC”)...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 74.5 - Subsection 74.5(11) | transfer from wife to higher-income husband was infused with his income-splitting purpose (as well as regulatory breach if she didn’t transfer) | 393 |
| Tax Topics - General Concepts - Ownership | wife and children did not acquire beneficial interest in shares the taxpayer was to transfer to them, under tax plan, until the share transfer occurred | 263 |
| Tax Topics - Income Tax Act - Section 86 - Subsection 86(2) | family members did not acquire beneficial interest in new shares until after completion of s. 86 reorg | 297 |
| Tax Topics - General Concepts - Fair Market Value - Shares | arm’s length sales price established FMV for closing-date internal transfer of same shares | 482 |
| Tax Topics - Income Tax Act - Section 163 - Subsection 163(2) | was not responsible under s. 163(2) for the unbeknownst sharp practice of his tax advisor | 692 |
| Tax Topics - General Concepts - Price Adjustment Clause | no jurisdiction to comment on application of price adjustment clause where the affected taxpayers are not appellants | 233 |
Administrative Policy
2 July 2003 External T.I. 2002-0180015 F - Usufruit d'un immeuble
Mr. X disposes of his principal residence and the underlying land to a corporation (whose shareholders are his son and an arm’s length person)...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 251 - Subsection 251(1) - Paragraph 251(1)(c) | transferor to a deemed s. 248(3) trust who receives a usufruct does not deal at arm’s length with the trust | 266 |
| Tax Topics - Income Tax Act - 101-110 - Section 105 - Subsection 105(1) | no benefit re use of personal-use property | 180 |
Paragraph 69(1)(c)
Cases
Gervais v. The Queen, 85 DTC 5004, [1984] CTC 661 (FCTD)
A contract of sale cannot be a gift, which is a gratuitous transfer of property. The acquisition by the taxpayer of real property from his father...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Statutory Interpretation - Provincial Law | 54 |
Hutterian Brethren Church of Wilson v. The Queen, 79 DTC 5474, [1980] CTC 1, 79 DTC 5479 (FCA)
The donation of services, such as farming labour, by members of a Hutterite religious colony to their corporation did not constitute an...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 149.1 - Subsection 149.1(1) - Charitable Organization | 98 | |
| Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(a) | 31 |
See Also
Cassan v. The Queen, 2017 TCC 174
In rejecting (at para. 296) a Crown submission (summarized at para. 249) that “gift” required “detached and disinterested generosity”)...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 118.1 - Subsection 118.1(1) - Total Charitable Gifts | common law gift was vitiated by loan to donor at unreasonably low rate | 793 |
| Tax Topics - Income Tax Act - Section 143.2 - Subsection 143.2(12) | although borrowing by taxpayers had a term of 9.3 years, they had a reasonable expectation of refinancing with the promoter’s assistance | 478 |
| Tax Topics - Income Tax Act - Section 143.2 - Subsection 143.2(7) - Paragraph 143.2(7)(a) | loans were not bona fide in that not handled with commerciality | 701 |
| Tax Topics - Income Tax Regulations - Regulation 7000 - Subsection 7000(2) - Paragraph 7000(2)(d) | no requirement to accrue interest on index-linked note in a year when the return thereon was not determinable | 605 |
| Tax Topics - Income Tax Act - Section 20 - Subsection 20(1) - Paragraph 20(1)(c) - Subparagraph 20(1)(c)(i) | interest on loan to acquire LP units was deductible as there was a prospect of gross income being allocated by LP in 19 years’ time | 619 |
| Tax Topics - Statutory Interpretation - Realization Principle | amount should not be recognized until ascertainable | 73 |
Administrative Policy
24 January 2019 External T.I. 2018-0773301E5 - Paragraph 69(1)(c) and Nominal Consideration
$1 consideration is specified in the legal documentation for a gift of property by a parent to a child solely to ensure the agreement is legally...
22 March 2016 Internal T.I. 2013-0506561I7 - Property acquired on a return of capital
What is the cost (and amount incurred as an expense) for intellectual property with an unlimited life acquired by a corporation resident in Canada...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 69 - Subsection 69(4) | FMV cost of property acquired on QROC distribution | 121 |
| Tax Topics - Income Tax Act - Section 54 - Adjusted Cost Base | FMV cost of contributed or distributed property | 53 |
| Tax Topics - Income Tax Act - Section 14 - Subsection 14(5) - Eligible Capital Expenditure | QROC distribution by a foreign affiliate to its Canadian shareholder of ECP results in ECE to the shareholder of the property’s FMV | 220 |
| Tax Topics - Income Tax Act - Section 14 - Subsection 14(5) - Cumulative Eligible Capital - Variable A - Variable A.1 | no gain to FA transferor of ECP | 99 |
10 October 2014 APFF Roundtable, 2014-0538621C6 F - Disposition en contrepartie de 1$
Does CRA consider, similarly to Revenu Québec, that a transfer of an immovable for $1 can be a gift? After referring to s. 8.1 of the...
26 June 2013 External T.I. 2013-0490711E5 F - Disposition en contrepartie de 1$
Could the acquisition of a property for consideration of one dollar qualify as an acquisition by gift for purposes of s. 69(1)(c)? The Directorate...
11 December 2012 External T.I. 2011-0423441E5 F - Options d'achat d'actions et décès
Respecting the determination of the cost of employee stock options to the estate of the deceased employee, CRA stated that it:
generally accepts...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 110 - Subsection 110(1.1) | no 110(1)(d) deduction available for deemed s. 7 benefit on death | 173 |
21 December 2012 Internal T.I. 2009-0327221I7 - Paragraph 7(1)(e) - Death of a Taxpayer
After noting that a deceased employee would be deemed under s. 7(1)(e) to dispose of unexercised stock options at fair market value on death, CRA...
Income Tax Technical News No. 44 13 April 2011 [archived]
Is it CRA's position that "where property is transferred to a corporation by a shareholder for no consideration, the corporation will not have any...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 111 - Subsection 111(1) - Paragraph 111(1)(a) | inter-provincial loss shifting | 69 |
| Tax Topics - Income Tax Act - Section 20 - Subsection 20(1) - Paragraph 20(1)(e) | exchangeable debenture appreciation not recognized | 102 |
| Tax Topics - Income Tax Act - Section 20 - Subsection 20(1) - Paragraph 20(1)(f) | exchangeable debenture appreciation not recognized | 120 |
| Tax Topics - Income Tax Act - Section 49 - Subsection 49(1) | exchangeable debenture exercise | 90 |
| Tax Topics - Treaties - Income Tax Conventions - Article 10 | use of s.à r.l. | 131 |
1 February 2006 External T.I. 2005-0142411E5 F - Don entre vifs - bien agricole admissible
CRA indicated that an individual who donated land to an unrelated couple could be regarded as not dealing with them at arm’s length (stating...
IT-464R, para. 8
"When a tenant makes improvements and alterations to leased property and subsequently abandons them, they are not considered to have been...
22 May 1997 External T.I. 9641435 - CHARITABLE REMAINDER TRUST - COST OF PROPERTY TO TRUST
Where property is transferred to a trust for purposes of donating an equitable interest in the trust to a charity, the proceeds of disposition...
22 January 1996 Internal T.I. 9530067 - GIFT OR SALE?
"Should the properties have been bequeathed or gifted, the ACB to the recipient will, by virtue of paragraph 69(1)(c), be the FMV at the time of...
May 1995 Executive Institute Round Table, Q. 24 (C.T.O. "Employee Stock Option")
Where an estate acquires employee stock options by way of bequest, it is deemed to acquire the property at fair market value. Provided that the...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 9 - Capital Gain vs. Profit - Options | 20 |
October 1992 Central Region Rulings Directorate Seminar, Q. B. (May 1993 Access Letter, p. 229)
RC assumes, in the absence of clear evidence to the contrary, that an expropriation in a foreign jurisdiction has occurred in accordance with the...
September 1992 B.C. Revenue Canada Round Table, p. 21 (May 1993 Access Letter, p. 227)
Where personal property is transferred to a trust with the creation of a lifetime income interest payable only to the transferor and a residual...
Articles
Atlas, "Tax Planning for Foreign Inheritances", Tax Topics, No. 1247, 1 February 1996
Discussion of the determination of the cost of property held by a non-resident trust.
Subsection 69(2)
Cases
Indalex Ltd. v. The Queen, 86 DTC 6039, [1986] 1 CTC 219 (FCTD), aff'd 88 DTC 6053, [1988] 1 CTC 60 (FCA)
The taxpayer purchased its supplies of aluminium from a Burmudan affiliate ("Pillar International") which in turn purchased the aluminium from an...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 15 - Subsection 15(1) | 17 | |
| Tax Topics - Income Tax Act - Section 245 - Old | 66 |
Administrative Policy
93 C.R. - Q. 33
Discussion of weaknesses of comparable profit method.
93 C.M.TC - Q. 17
The comparable profit method set out in the regulations to IRC s. 482 is very unlikely to produce a result that is compatible with the arm's...
93 C.M.TC - Q. 13
RC will consider allowing a reasonable mark-up on charges for services (including computer services) provided by non-residents to related Canadian...
89 C.R. - Calderwood Paper (C.42)
The operative words 'reasonable in the circumstances' may mean fair market value or another amount, depending on the facts of a particular...
IC 94-4 "International Transfer Pricing: Advance Pricing Agreements (APA)"
IC 87-2 "International Transfer Pricing and Other International Transactions"
IT-468R "Management or Administration Fees Paid to Non-residents" (Archived) 29 December 1999
RC is prepared to accept an allocation of the costs, direct and indirect, reasonably attributable to providing the relevant services to the...
Articles
Purdy, Zanchelli, "Calculating and Supporting Management Fees (A Departure from the 'Back of the Envelope' Approach)", International Tax Planning, 1996 Canadian Tax Journal, Vol. 44, No. 1, 1996, p. 157.
Boidman, Lawlor, "Transfer Pricing in the Absence of Comparable Market Prices: Canada", Studies on International Fiscal Law, Volume LXXIIa, p. 323 (International Fiscal Association, Rotterdam, 1992).
Finance
1996 A.P.F.F. Round Table No. 7M12910: Discussion of position on transactional net margin and comparable margin of profit methods.
Subsection 69(3)
Cases
R. v. Kleysen, 96 DTC 6265, [1996] 2 CTC 201 (Man QB)
After noting the submission for the accused that the relevant valuation test for sale of equipment by Canadian taxpayers to a related off-shore...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 239 - Subsection 239(1) - Paragraph 239(1)(a) | 151 |
Administrative Policy
18 March 1992 T.I. (Tax Window, No. 18, p. 4, ¶1816)
Where a Canadian subsidiary guarantees the U.S. bank debt of its U.S. parent, the amount of a reasonable guarantee fee will be included in its...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 15 - Subsection 15(1) | benefit where sub guarantees bank loan to US parent | 70 |
91 C.R. - Q.30
Where a Canadian subsidiary guarantees the loan obligations of a foreign parent, s. 69(3) will apply to deem the amount that would have been...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 15 - Subsection 15(1) | 24 |
Articles
Yukich, "Taxation of Export Sales from Canada", 1993 Corporate Management Tax Conference Report, c. 9.
Subsection 69(4) - Shareholder appropriations
Cases
Boardman v. The Queen, 85 DTC 5628, [1986] 1 CTC 103 (FCTD)
The word "appropriated" embraces an action of a third party - here, a court order directing that capital properties of the corporation be...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 246 - Subsection 246(1) | 69 | |
| Tax Topics - Income Tax Act - Section 56 - Subsection 56(2) | 148 |
See Also
Husky Oil Limited v. Canada, 2010 DTC 5089 [at 6887], 2010 FCA 125
Sharlow, J.A. found that the "gift portion" exception to the rollover rule in s. 87(4) did not apply to a transaction in which the taxpayer...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - General Concepts - Onus | 88 | |
| Tax Topics - Income Tax Act - Section 87 - Subsection 87(4) | 184 | |
| Tax Topics - Statutory Interpretation - Specific v. General Provisions | avoidance of two statutory deeming rules creating two different statutory fictions | 190 |
Javalin Founderies & Machine Works Ltd. v. MNR, 67 DTC 392 (TAB)
In finding that a transaction under which the individual non-resident shareholder of a Canadian corporation took possession of all its assets...
Administrative Policy
31 May 2017 External T.I. 2016-0642621E5 - Donation to private foundation
CRA confirmed that the s. 38(a.1) rule prevails over s. 69(4), as well as s. 69(1)(b)(ii), so that where a corporation transfers shares of a...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 38 - Paragraph 38(a.1) | s. 38(a.1) prevails over s. 69(4) | 195 |
22 March 2016 Internal T.I. 2013-0506561I7 - Property acquired on a return of capital
What is the cost (and amount incurred as an expense) for intellectual property with an unlimited life acquired by a corporation resident in Canada...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 69 - Subsection 69(1) - Paragraph 69(1)(c) | FMV cost of property acquired on contribution of capital | 121 |
| Tax Topics - Income Tax Act - Section 54 - Adjusted Cost Base | FMV cost of contributed or distributed property | 53 |
| Tax Topics - Income Tax Act - Section 14 - Subsection 14(5) - Eligible Capital Expenditure | QROC distribution by a foreign affiliate to its Canadian shareholder of ECP results in ECE to the shareholder of the property’s FMV | 220 |
| Tax Topics - Income Tax Act - Section 14 - Subsection 14(5) - Cumulative Eligible Capital - Variable A - Variable A.1 | no gain to FA transferor of ECP | 99 |
15 November 2013 Internal T.I. 2013-0478621I7 F - Transfer of intangibles - TP adjustments
Pursuant to a sales agreement between Canco, its immediate non-resident parent (Parent) and the ultimate U.S. parent of Canco (Pubco), as vendors,...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 247 - New - Subsection 247(2) | group sale with Canco not charging for intangibles should engage s. 247(2) | 149 |
| Tax Topics - Income Tax Act - Section 56 - Subsection 56(2) | secondary adjustment re group sale with Canco not charging for intangibles | 248 |
9 January 2004 Internal T.I. 2003-0031601I7 F - Air Miles :employés/employeurs
A corporation has acquired property for a shareholder or employee with its accumulated Air Miles used by the shareholder or employee in the course...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 6 - Subsection 6(1) - Paragraph 6(1)(a) | business air miles assumed to be used before personal air miles | 125 |
Subsection 69(5) - Idem [Shareholder appropriations]
Administrative Policy
14 May 2015 CLHIA Roundtable, 2015-0573841C6 - 2015 CLHIA Roundtable Winding-up and ACB
At the 2005 CALU Roundtable (2005-0116631C6), the CRA indicated that s. 69(5) would likely take precedence over s. 148(7) on the wind-up of a...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 148 - Subsection 148(7) | s. 69(5) generally prevails over s. 148(7) | 112 |
Subsection 69(11) - Deemed proceeds of disposition
Cases
Canada v. Oxford Properties Group Inc., 2018 FCA 30
When Oxford Properties was sold to an OMERS subsidiary, the purchaser first negotiated that Oxford would drop various properties down into LPs on...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 245 - Subsection 245(4) | using the s. 88(1)(d) bump on newly-formed rental property LPs to avoid indirect recapture income under s. 100(1) was abusive | 975 |
| Tax Topics - Income Tax Act - Section 88 - Subsection 88(1) - Paragraph 88(1)(d) | s. 88(1)(d) bump is intended to permit the transfer of ACB that otherwise would be lost to another property that is taxed in the same way | 371 |
| Tax Topics - Income Tax Act - Section 98 - Subsection 98(3) - Paragraph 98(3)(c) | s. 98(3)(c) bump is intended to avoid gain realization where there has been no economic gain | 267 |
| Tax Topics - Income Tax Act - Section 100 - Subsection 100(1) | purpose is to ensure that latent recapture will be recognized on sale to tax exempt | 254 |
| Tax Topics - Income Tax Act - Section 97 - Subsection 97(2) | object includes ultimate taxation of the deferred gain | 234 |
| Tax Topics - Income Tax Act - Section 171 - Subsection 171(1) | GAAR question as to determining a provision’s object was subject to correctness standard | 169 |
| Tax Topics - Statutory Interpretation - Hansard, explanatory notes, etc. | statement that amendment was for “clarification” was self-serving | 209 |
| Tax Topics - Statutory Interpretation - Interpretation Act - Subsection 45(2) | determination of whether amendment merely clarified requires review of pre-amendment state of law | 146 |
| Tax Topics - Income Tax Act - Section 245 - Subsection 245(2) | consequential s. 245(2) adjustment must be scaled to the abuse | 391 |
See Also
Oxford Properties Group Inc. v. The Queen, 2016 TCC 204, rev'd 2018 FCA 30
When Oxford Properties was sold to an a Canadian pension fund (OMERS) subsidiary, the purchaser first negotiated that Oxford would drop various...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 245 - Subsection 245(4) | no abuse in using 88(1)(d) bump to avoid s. 100 after 3-year s. 69(11) period | 557 |
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(10) | subsequent sale part of series as it utilized the benefit of previous LP packaging and bump transactions | 387 |
| Tax Topics - Income Tax Act - Section 97 - Subsection 97(2) | purpose not to tax underlying recapture on subsequent LP unit sale | 431 |
| Tax Topics - Income Tax Act - Section 88 - Subsection 88(1) - Paragraph 88(1)(d) | purpose: to push down ACB of shares of sub to qualifying non-depreciable property | 489 |
| Tax Topics - Statutory Interpretation - Interpretation Act - Subsection 45(2) | subsequent amendment shed light on scope of previous version | 107 |
| Tax Topics - Income Tax Act - Section 100 - Subsection 100(1) | S. 100 operates only on outside basis gain | 290 |
| Tax Topics - Income Tax Act - Section 98 - Subsection 98(3) - Paragraph 98(3)(c) | purpose: to preserve high outside basis through push down | 293 |
Administrative Policy
2 December 2014 CTF Roundtable, Q2(c)
Must corporations be affiliated or related or both in a loss consolidation arrangement? CRA responded:
The CRA will consider ruling requests where...
2014 Ruling 2014-0523221R3 - Amalgamation of mutual funds
Proposed transactions
C1, which is a smaller mutual fund corporation than C2, will amalgamate with C2 to form Amalco. C1, C2 and Amalco have...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 111 - Subsection 111(5.5) | amalgamation of two mutual fund corporations each with capital losses | 134 |
| Tax Topics - Income Tax Act - Section 256 - Subsection 256(7) - Paragraph 256(7)(b) | amalgamation of two mutual fund corporations each with capital losses | 132 |
2 December 2010 External T.I. 2010-0376451E5 F - Paragraphe 69(11) et transfert de biens agricoles
Upon the death of their father (Mr. X), Sons A and B received a devise of the farm that he had actively farmed until his death, but which was not...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 70 - Subsection 70(9) | s. 70(9.01) could apply to devise of farming property, that was farmed by father but not sons, to them | 110 |
| Tax Topics - Income Tax Act - 101-110 - Section 110.6 - Subsection 110.6(1.3) - Paragraph 110.6(1.3)(a) | capital gains exemption could apply where farming property, that was farmed by father but not sons, is devised to sons who then sell | 200 |
23 January 2008 External T.I. 2006-0206351E5 F - Subsection 69(11)
S. 69(11) did not appear to apply to the transfer by a couple of a portion of their interests in a family farm partnership on a rollover basis to...
2 February 2006 External T.I. 2005-0152431E5 F - Utilization of non-capital losses
Ms. A, who owned all the shares of Lossco, which had disposed of all the assets of its (unspecified) business for cash, disposed of those shares...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 256 - Subsection 256(7) - Paragraph 256(7)(a) - Subparagraph 256(7)(a)(i) | s. 256(7)(a)(i) applicable where sister transfers Lossco to Profitco owned equally by her and three siblings | 52 |
2002 Ruling 2001-0116073 - Certain Tax Consequences of buy/bump/sell
Where prior to the acquisition of Target, Target transfers assets on a rollover basis to a wholly-owned subsidiary of Target ("Xco"), and then...
31 October 2002 External T.I. 2002-0141265 F - NATURE D'UN BIEN APRES ROULEMENT
A couple who co-owned farmland transferred it on a s. 85(1) rollover basis to a corporation controlled by them before its sale to “known”...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 9 - Capital Gain vs. Profit - Real Estate | property does not change its character as capital property where transferred to related corporation under s. 85(1) for immediate sale | 80 |
1996 Tax Executives Round Table, Q. XIL (No. 9639150)
Where a taxpayer contributes property with an accrued gain to a loss corporation on a rollover basis and then, prior to the expiration of the...
18 August 1995 External T.I. 9515455 - DEEMED PROCEEDS OF DISPOSITION
Where a corporation ("Newco") incorporated by an individual (B) acquires all the shares of Oldco from another individual (A) with whom B deals at...
93 CPTJ - Q.14
In one recent case, RC concluded that a series of transactions which technically avoided the application of s. 69(11) because the subsequent...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 245 - Subsection 245(4) | 43 |
91 CPTJ - Q.1
Whether the vendor has knowledge and control of the series of transactions may be considered when determining whether s. 69(11) applies.
89 C.R. - Read Paper (C.18)
S.69(11) may apply upon a butterfly of property to a minority corporate shareholder as part of a series of transactions that includes a later sale...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 110.6 - Subsection 110.6(7) | 12 |
Articles
Perry Truster, "Loss Trading and Subsection 69(11)", Tax for the Owner-Manager, Vol. 17, No. 2, April 2017
Example of sale of equipment to Lossco (p. 4)
1) Assume that X Co, a CCPC, has three shareholders, none of whom has used his or her...
David M. Williamson, Michael H. Manly, "Subsection 69(11) - Unexpected Problems from Inappropriate Positions", Corporate Structures and Groups, Vol. V, No. 4, 1999, p. 285.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(10) | 0 |
Marc N. Ton-That, "Unexpected Problems under Subsection 69(11)", Corporate Structures and Groups, Vol. V, No. 3, 1999, p. 268.
Paragraph 69(11)(b)
Administrative Policy
2017 Ruling 2017-0693751R3 - Transfer of Shares of a Foreign Affiliate
See the diagram for the quite similar transactions ruled upon in 2016-0630761R3.
A Canadian-resident corporation (ACo) wished to transfer its...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 93 - Subsection 93(1.11) | step-up in FA shares transferred into New FA and then sold for note to an affiliated Canco limited to sum of RCB and net surplus | 248 |
| Tax Topics - Income Tax Act - Section 9 - Capital Gain vs. Profit - Shares | affiliated transfer of shares at gain equal to exempt surplus did not cause loss of capital property status | 85 |
21 October 2013 Internal T.I. 2013-0505831I7 - Rollover and subsequent disposition of property
The taxpayer, a Canadian corporation, transferred all its voting and participating shares of Subco, a non-resident subsidiary wholly-owned...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 85.1 - Subsection 85.1(3) | s. 69(11)(b) not applied | 259 |
Subsection 69(13) - Amalgamation or merger
Administrative Policy
S4-F7-C1 - Amalgamations of Canadian Corporations
1.98 In the case of an amalgamation or merger, there may not technically be a disposition of property from a predecessor corporation to the new...
5 March 1992 External T.I. 5-913271
In the case of an amalgamation described in s. 87(1), the cost amount of inventory of a predecessor for purposes of s. 69(13) would be its value...
Subsection 69(14) - New taxpayer
Administrative Policy
20 February 2003 External T.I. 2002-0156675 - Affiliated Persons and Deemed FMV
"The 'taxpayer' referred to in subsection 69(14) will include both the taxpayer that is the transferor in subsection 69(11), as well as each...