Section 70

Table of Contents

Subsection 70(1) - Death of a taxpayer

Administrative Policy

21 August 1991 T.I. (Tax Window, No. 8, p. 10, ¶1404)

Interest on most compound debt instruments and term deposits accrues on a daily basis, with the result that on the holder's death, the accrued...

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Subsection 70(2) - Amounts receivable

Cases

Crown Trust Co. v. Minister of National Revenue, 65 DTC 5176, [1965] CTC 295, [1965] S.C.R. 723

S.64(2) of the pre-1972 Act did not apply to pension benefits which were paid to the estate of the deceased because the amounts could only be...

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Administrative Policy

May 2019 CPA Alberta CRA Roundtable, ITA Session – Q.20

Are all authorizations of representatives cancelled when a taxpayer dies? CRA responded:

Starting in May 2019, online authorizations for deceased...

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9 March 2015 External T.I. 2012-0469761E5 F - Rights or things

A corporation wholly-owned by a discretionary non-testamentary trust (with an individual, his spouse and children as beneficiaries) declares a...

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30 July 2012 External T.I. 2011-0421801E5 F - Choix aux paragraphes 70(2) et 70(3)

The taxpayer's share of partnership income from the beginning of the fiscal period to the date of death was included in the taxpayer’s terminal...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 70 - Subsection 70(3) application of s. 70(3) re deceased’s share of partnership WIP is at estate’s choice 258

23 March 2009 External T.I. 2008-0293131E5 F - Prestations reçues par une succession

An individual who had been receiving long-term disability benefits after an illness had prevented continuation of the individual’s employment,...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 6 - Subsection 6(1) - Paragraph 6(1)(f) amounts received by estate in settlement of deceased’s action for unpaid employment-termination disability were taxable 130
Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Death Benefit survivor benefit in settlement of rights under a wage loss replacement plan could be a death benefit 143

5 March 2009 External T.I. 2008-0279241E5 F - Prestation consécutive au décès

Before addressing the treatment of $5,000 paid by a union to an active member on the member’s death, CRA discussed the treatment of amounts paid...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Death Benefit benefit paid on union member’s death could not be a death benefit (no employer-employee relationship 30
Tax Topics - Income Tax Act - Section 6 - Subsection 6(1) - Paragraph 6(1)(j) amount paid to union member could be treated as a refund of union dues with the balance taxable under s. 6(1)(j) 106

7 April 2005 External T.I. 2004-0099191E5 F - Inventaire d'un artiste

After noting that the inventory of an artist that is valued at nil pursuant to s. 10(6) is a right or thing, CRA indicated that, subject to s....

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 10 - Subsection 10(6) reporting nil inventory on T2124 form is treated as making the election 82
Tax Topics - Income Tax Act - Section 9 - Capital Gain vs. Profit - Commodities, and commodities futures and derivatives legatee generally acquires a deceased artist’s inventory on capital account 26

21 December 1995 External T.I. 9526035 - RIGHTS AND THINGS

A dividend declared by a corporation within a month following the end of its fiscal period that is payable 14 months after the end of that fiscal...

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93 C.R. - Q. 38

An amount in a taxpayer's net income stabilization account fund no. 2 on hand at the time of her death will not be a right or a thing to which s....

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9 January 1992 T.I. (Tax Window, No. 15, p. 23, ¶1690)

Old age security benefits which the estate is entitled to apply for and which would have been payable to the deceased had an application been made...

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91 C.R. - Q.27

An enforceable claim to unpaid management bonus would constitute a "right or thing". However, where the employer had a contractual obligation to...

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12 December 1989 Memorandum (May 1990 Access Letter, ¶1207)

An unexercised employee stock option held by an employee at the time of his death is not a "right or thing" because it is a right to purchase a...

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18 October 89 Meeting with Quebec Accountants, Q.14 (April 90 Access Letter, ¶1166)

The entitlement of a deceased employee to receive amounts under a leave of absence program constitutes a right or thing for purposes of s. 70(2).

81 C.R. - Q.16

S.70(2) generally will be applicable to a funded deferred compensation arrangement, whereas it will not generally be applicable to a lump sum...

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Articles

Thomas McCallum, "The Final Tax Return", CGA Magazine, January-February 2012, p.48

Non-technical discussion of opportunities for using separate return.

Innes, "If the Tax Treatment of Accrued Gains on Inventory at Death", Estates and Trust Journal, Vol. 12, 1992, p. 122.

Subsection 70(3) - Rights or things transferred to beneficiaries

Cases

Tory Estate v. M.N.R., 73 DTC 5354, [1973] CTC 434 (FCA), briefly aff'd 76 DTC 6312, [1976] CTC 415 (SCC)

A non-resident beneficiary of the Tory Estate ("Mrs. Denton"), who was entitled to a cash legacy of $90,000, purchased accounts receivable of...

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See Also

Agence du revenu du Québec v. Teitelbaum, 2019 QCCA 1408

The common-law partner of the taxpayer had not yet, at the time of his death, retired for purposes of the retirement compensation arrangement...

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Teitelbaum v. Agence du revenu du Québec, 2017 QCCQ 8039, rev'd 2019 QCCA 1408

The plaintiff (“Teitelbaum”) received $1.4 million approximately two years after the death of her common-law partner (“Lewin”) as a result...

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Administrative Policy

22 September 2011 External T.I. 2011-0394961E5 F - Droits ou biens

Where the value of the inventory of an artist’s business was deemed to be nil pursuant to s. 10(6), and s. 70(3) applied to the transfer of a...

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28 June 2017 External T.I. 2016-0653921E5 F - Beneficiary/person beneficially interested

Would s. 70(3) apply where the will bequeathed rights and things (here, artistic works which had been included in the deceased artist’s...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 248 - Subsection 248(25) testamentary trust could be considered to have a right as beneficiary in estate 122

30 July 2012 External T.I. 2011-0421801E5 F - Choix aux paragraphes 70(2) et 70(3)

The taxpayer's share of partnership income from the beginning of the fiscal period to the date of death was included in the taxpayer’s terminal...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 70 - Subsection 70(2) if desire for s. 70(3) to apply, a timely revocation of s. 70(2) election can be made 270

Subsection 70(5) - Capital property of a deceased taxpayer

Cases

Nussey v. Canada, 2001 DTC 5240, 2001 FCA 99

The two sons of the taxpayer had transferred to him shares of a family corporation. The shareholders agreement provided that, on the death of a...

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Locations of other summaries Wordcount
Tax Topics - General Concepts - Effective Date agreed retroactive redemption date was ineffective 81
Tax Topics - General Concepts - Mistake 160

The Queen v. Mastronardi Estate, 77 DTC 5217, [1977] CTC 355 (FCA)

The taxpayer died suddenly and without warning of a heart attack. Shares that the deceased held in a company which held a term life insurance...

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See Also

Bueti v. The Queen, 2015 DTC 1213 [at 1374], 2015 TCC 265

Mrs. Bueti, who was entitled to receive 1/3 of the residue of estate of her father (who died in August 1999), was found to have purchased, as...

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Locations of other summaries Wordcount
Tax Topics - General Concepts - Ownership residuary beneficiary had no ownership of estate property 118
Tax Topics - Income Tax Act - Section 248 - Subsection 248(8) - Paragraph 248(8)(a) residuary beneficiary did not acquire as a consequence of death 135

Nauss v. The Queen, 2005 DTC 1370, 2005 TCC 488 (Informal Procedure)

In 1997 the taxpayer and his sister inherited from their grandmother a remainder interest in a house. with their 70-year old mother inheriting a...

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Locations of other summaries Wordcount
Tax Topics - General Concepts - Fair Market Value - Land 152

Anderson Estate v. The Queen, 95 DTC 758 (TCC)

The sister-in-law of the deceased who had lived with him for more than 50 years and worked on his farm venture jointly with him for most of that...

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Administrative Policy

15 June 2021 STEP Roundtable Q. 6, 2021-0883021C6 - Vested Indefeasibly

What happens on the death of a resident beneficiary holding a capital interest in a resident trust which has vested indefeasibly?

CRA indicated...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - 101-110 - Section 108 - Subsection 108(1) - Trust - Paragraph (g) meaning of vested indefeasibly/ no particular T3 disclosure is required where all the interests in a trust have vested indefeasibly 278

8 July 2020 CALU Roundtable Q. 7, 2020-0842251C6 - Valuation of private company shares

At the 2009 British Columbia tax conference the CRA stated:

"...non-participating controlling shares have some value and may therefore bear a...

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Locations of other summaries Wordcount
Tax Topics - General Concepts - Fair Market Value - Other special voting shares generally are not accorded value 117

29 May 2018 STEP Roundtable Q. 8, 2018-0742141C6 - Application of subsection 70(5)

In the course of dealing with a secondary issue, McKenzie stated that s. 70(5) does not apply to a non-resident person. CRA stated that this has...

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6 October 2017 APFF Financial Strategies and Instruments Roundtable Q. 8, 2017-0712621C6 F - Dépôt en monnaie étrangère-Immobilisation

S. 39(1.1) would not apply to a sum of money in foreign currency held on deposit by an individual at a financial institution. Instead the...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 39 - Subsection 39(1.1) non-application to FX deposits 187

10 June 2016 STEP Roundtable Q. 10, 2016-0645781C6 - US Revocable Living Trusts

CRA indicated that a (U.S.) revocable living trust is a true trust and not a bare trust given that it has remainder beneficiaries. CRA then was...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(1) U.S. revocable living trust is not a bare trust 171
Tax Topics - Income Tax Act - Section 248 - Subsection 248(8) - Paragraph 248(8)(a) remainder beneficary of inter vivos trust 165

12 December 2014 External T.I. 2013-0511391E5 F - Deemed disposition of capital interest in personal trust

The sole beneficiary of an inter vivos trust (the "Trust"), whose interest under the Trust had vested indefeasibly, died, as a result of which his...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - 101-110 - Section 107 - Subsection 107(2) full step-up of properties distributed in satisfaction of an estate's capital interest in an inter vivos personal trust 340

24 May 2012 External T.I. 2011-0429991E5 - Price Adjustment Clause

Mr. A engages in an estate freeze transaction in Year 1 in which all his common shares are exchanged in a s. 86 reorganization for preferred...

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Locations of other summaries Wordcount
Tax Topics - General Concepts - Effective Date 157

28 November 2010 CTF Roundtable, 2013-0487431C6 - Value of Vote-Only Shares – 2010 CTF Conference

The questioner referenced the CRA statement at the 2009 British Columbia Tax Conference that, in the context of an estate freeze of a...

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2 February 2006 External T.I. 2005-0111911E5 F - Participation indivise dans un immeuble-fiducie

At the time of Mr. X's death, the usufruct of all the property held by Mr. X, including his undivided share in a two-unit Immovable, devolved to...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 54 - Principal Residence - Paragraph (c.1) grant under will of usufruct in 2-unit property to surviving spouse constituted a disposition to a testamentary trust which could make the (c.1) designation for the home unit 183

7 October 2005 Roundtable, 2005-0138111C6 F - Actions donnant droit au produit d'assurance-vie

The taxpayer wants the proceeds of the universal life insurance policy on his life paid on his death to his adult child, rather than to his...

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7 October 2005 Roundtable, 2005-0138361C6 F - Actions d'assurance vie

The shareholder of a wholly-owned corporation acquires for $1 a special share that is redeemable for $1 at the discretion of the corporation and...

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4 October 2002 External T.I. 2002-0154725 - LIFE INTEREST-REMAINDER INTEREST

On the death of Mrs. X, a life interest in a residence was received by her surviving husband (Mr. X) and the remainder interest by her daughter...

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11 February 2002 External T.I. 2000-0004416

Where a Canadian resident individual inherits the shares of a publicly-traded company from a foreign relative, those shares will have a nil cost...

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May 1999 CALU Conference No. 9908430 Q. 8

Where a shareholder holds a special share (in addition to common shares of the corporation) with a nominal redemption value, and the shareholders...

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3 March 1995 External T.I. 9429915 - TRANSFER ON DEATH OF JOINTLY-OWNED PROPERTY

The taxpayer's representative argued that because each joint tenant has an interest in the whole of the property, when the first joint tenant dies...

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29 July 1992 External T.I. 5-921406

Where a taxpayer died in the Province of Quebec before 1989 in possession of property subject to a usufruct, s. 70(5)(c) would apply to the person...

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90 C.R. - Q54

The ratio in s. 70(5)(b) which applies for determining a beneficiary's deemed cost of each depreciable asset in a class also is the ratio which...

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88 C.R. - Q49

Neither s. 69 nor s. 70(5) applies to an accrual basis taxpayer when under the terms of his will a non-capital asset is transferred upon his death.

86 C.R. - Q56

A beneficiary to whom a mortgage receivable with a value less than its principal amount is distributed by the executors will realize a capital...

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IC 89-3 "Policy Statement on Business Equity Valuations"

Discussion of the circumstances in which a buy-sell agreement will be considered determinative of value for purposes of s. 70(5).

Locations of other summaries Wordcount
Tax Topics - General Concepts - Fair Market Value - Shares 0

Articles

Brian Nichols, "Double Taxation 101", Tax Topics, No. 1570, 11 April 2002, p. 1

Comparison of Pipeline Strategy With S.164(6) Strategy.

Cadesky, "Succession of the Family Business", Estates and Trusts Journal, 1994, Volume 13, p. 219.

Subsection 70(5.1)

Administrative Policy

6 December 2011 External T.I. 2010-0384701E5 F - Décès contribuable - Immobilisation admissible

Mr. X bequeathed all his property to his children including goodwill that he had generated over the years from his business, which his estate then...

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Locations of other summaries Wordcount
Tax Topics - General Concepts - Effective Date CRA policy of price adjustment clauses inapplicable where deferred sale price subsequently adjusted 253
Tax Topics - Income Tax Act - Section 152 - Subsection 152(4.2) CRA policy for adjusting a statute-barred year for a reduction in the 5th year of staged-proceeds sale 147

Subsection 70(5.2) - Resource property and land inventory

Administrative Policy

22 June 2020 External T.I. 2017-0728051E5 F - Land inventory

Does "land" in s. 70(5.2) include not only vacant land but also land on which other real property is erected, such as houses for sale or condo...

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Words and Phrases
land

20 June 2014 External T.I. 2014-0532221E5 - Disposition of Canadian resource property

As a result of a lease of subsurface rights to an oil company, Mr. A received monthly royalty payments (the "Royalty Payments"), which continued...

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7 February 2005 External T.I. 2005-0111431E5 F - Death of a Taxpayer - Deduction of CCDE

By virtue of being a member of a partnership (SENC), Mr. X was allocated his share of Canadian development expense (CDE) incurred by a corporation...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 66.2 - Subsection 66.2(2) CCDE balance cannot be deducted in terminal return or by estate 97

Subsection 70(5.3) - Fair market value

Administrative Policy

17 February 2022 External T.I. 2021-0882401E5 - Immigration and foreign life insurance policy

A non-resident individual, upon becoming resident in Canada, owned shares of a non-resident corporation (Foreignco A) which was the policyholder...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 128.1 - Subsection 128.1(1) - Paragraph 128.1(1)(c) s. 70(5.3) applied to valuation of shares of corp holding a foreign policy 160

19 May 2021 CLHIA Roundtable Q. 5, 2021-0884301C6 - 2021 CLHIA Roundtable - Q5 - Life insurance shares

A shareholder wants the proceeds of an insurance policy on his life, held by a corporation of which he is the sole shareholder (holding all the...

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19 May 2021 CLHIA Roundtable Q. 4, 2021-0884291C6 - 2021 CLHIA Roundtable - Q4 - Life insurance shares

The taxpayer wants the proceeds of the universal life insurance policy on his life paid on his death to his adult child, rather than to his...

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8 July 2020 CALU Roundtable Q. 5, 2020-0842191C6 - Jointly owned policies - 70(5.3)

Opco and A (its sole shareholder) jointly acquired a universal life insurance policy on the life of A, whose stipulated death benefit equals $1...

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Locations of other summaries Wordcount
Tax Topics - General Concepts - Fair Market Value - Other valuation of co-owned whole life policy 127

6 October 2006 Roundtable, 2006-0197111C6 F - Le paragraphe 70(5.3) de la Loi.

Mr. A owns all the issued and outstanding shares of Corporation 1 and Corporation 2 (making them sister corporations). Corporation 1 has a...

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20 September 1993 Income Tax Severed Letter 9321275 - Life Annuities

Although a life annuity is a life insurance policy which is issued or effected upon the life of a person, it is not a policy under which the life...

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84 C.R. - Q.54

S.70(5.3) is not applicable on a sale of shares to a non-arm's length person, and the proceeds of the life insurance policy will be a factor in...

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Subsection 70(6) - Where transfer or distribution to spouse or spouse trust

Cases

Picard v. Lagotte Succession, 2017 QCCS 330 (Quebec Superior Court)

A surviving spouse (Picard – who was not one of the residuary beneficiaries of the estate of his wife) argued that it was improper for the...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 70 - Subsection 70(6.2) executor was authorized under will to choose not to elect 595

Greenwood Estate v. The Queen, 94 DTC 6190, [1994] 1 CTC 310 (FCA)

The deceased taxpayer agreed to sell shares to his three sons for $800,000, payable by a promissory note, with such sale to be completed within 30...

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Words and Phrases
indefeasible vesting

Van Son Estate v. The Queen, 90 DTC 6183, [1990] 1 CTC 182 (FCTD)

The deceased taxpayer bequeath his 49% shareholding in a private company to his surviving wife. Joyal J. found that under a buy-sell agreement of...

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Hillis v. The Queen, 83 DTC 5365, [1983] CTC 348 (FCA)

Per Clement, D.J.: Only the property of the intestate taxpayer's estate to which his widow was entitled pursuant to the Intestate Succession Act...

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Locations of other summaries Wordcount
Tax Topics - Statutory Interpretation - Resolving Ambiguity 58

Katz Estate v. The Queen, 76 DTC 6377, [1976] CTC 633 (FCTD)

Since the deceased is deemed to have disposed of depreciable assets immediately before the time of his death, his representatives are precluded...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 249 - Subsection 249(1) 50

See Also

Husel Estate v. The Queen, 94 DTC 1765, [1995] 1 CTC 2298 (TCC)

A transfer of shares to the wife of the deceased in consideration for cash and set-off of debts owing to her by the estate occurred pursuant to a...

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May Estate v. MNR, 89 DTC 534, [1989] 2 CTC 2305 (TCC)

Following litigation in the Saskatchewan Surrogate Court, an order was made vesting in the deceased's widow nine one-quarter parcels of land....

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Locations of other summaries Wordcount
Tax Topics - General Concepts - Effective Date 23

The Queen v. Green Estate, 78 DTC 6324, [1978] CTC 501 (FCTD)

The testatrix provided in her will that the residue should be divided among her children then alive when there should no longer be any child of...

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Estate of the Late Gordon Clark Terrill v. Minister of National Revenue, [1987] 2 CTC 2216, 87 DTC 504

The will of the deceased bequeathed all of his property in trust for the exclusive benefit of his wife during her lifetime subject to the effect...

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Administrative Policy

29 May 2018 STEP Roundtable Q. 4, 2018-0743951C6 - Safe income and estate

CRA considers that there is no flow-through to the estate and beneficiaries of safe income attributable to shares where they were deemed to have...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 55 - Subsection 55(2.1) - Paragraph 55(2.1)(c) safe income flow through on a s. 70(6), but not s. 70(5), transfer 111

13 June 2017 STEP Roundtable Q. 11, 2017-0693331C6 - Substituted property of estate

The will of the deceased specifies that specified shares are to be transferred to a spousal trust. While the estate assets are being administered,...

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9 October 2015 APFF Financial Strategies and Instruments Roundtable Q. 9, 2015-0596611C6 F - Transfer 70(6)

An executor of an estate, whose residue was bequeathed to a spousal trust, paid the estate debts with liquid assets, transferred 75% of the...

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16 June 2014 STEP Roundtable, 2014-0523091C6 - STEP CRA Roundtable – June 2014

Can s. 70(6) apply to a transfer by a taxpayer both to his or her spouse and a transfer to his or her common law spouse? CRA stated:

…It is...

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11 January 2012 STEP Roundtable, 2011-0402291C6 - Subsection 248(8)-Intestacy-Transfer of Property

Where a taxpayer dies intestate, then provided the property of the deceased is distributed to the beneficiaries in accordance with the shares...

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12 March 2012 External T.I. 2010-0378451E5 - Vested Indefeasibly

Para. 8 of IT-449R (archived) re the effect of a buy-sell agreement on the "indefeasibly vested" requirement is still supportable.

8 October 2010 Roundtable, 2010-0371911C6 F - Biens dévolus au conjoint

In a situation where, in order to pay debts of the deceased, the executors of an estate sold a portion of the shares which were bequeathed to the...

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30 January 2009 External T.I. 2008-0287541E5 F - Décès - actions détenues en indivision

On the death of Y, his co-ownership interest in shares held with his spouse (X) passed to a spousal trust for her following the settling of the...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 248 - Subsection 248(21) block of shares is not a single property, so that partition must occur on a share-by-share basis giving rise to separately-held fractional shares 277

17 December 1996 Internal T.I. 9625727 - REMARRIAGE CLAUSE & DEF'N OF SPOUSAL TRUST

Where a will provided that the widow was entitled to receive the income of the estate but that her entitlement was "to be terminated upon her...

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9 May 2007 External T.I. 2006-0189931E5 F - Renonciation à une fiducie par un conjoint

The beneficiary of a testamentary spousal trust renounces all entitlements under the trust (other than income that has accrued to date) without...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 69 - Subsection 69(1) - Paragraph 69(1)(b) renunciation of interest in spousal trust not a disposition to the family beneficiaries 84
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

27 January 2004 External T.I. 2003-0006025 F - Roulement d'une partie d'un bien

Where part of an immovable was distributed to the spouse of the deceased, and the other interests in the immovable were distributed to children of...

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14 November 1996 External T.I. 9627345 - LENDING POWERS IN A SPOUSAL TRUST

Before referring to Peardon v. MNR, 86 DTC 1045, RC in its summary stated that "lending or investment of trust property to a non-spouse on...

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5 May 1995 External T.I. 9500985 - ASSUMPTION OF LIABILITIES

A transfer of shares of a private corporation made to the surviving spouse after her agreement to assume liabilities of the estate and provide...

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17 August 1994 External T.I. 9410535 - TRUSTS - "AS A CONSEQUENCE OF THE TAXPAYER'S DEATH"

A discretion accorded by the will to the executors to determine the particular assets to be distributed to the spouse or spousal trust of the...

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30 November 1993 Income Tax Severed Letter 9327165 - Vested Indefeasibly

In determining whether a by-sell agreement in a shareholders' agreement would result in shares not be considered to vest indefeasibly in the...

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22 November 1991 T.I. (Tax Window, No. 13, p. 7, ¶1632)

A designation under s. 104(13.1) or (13.2) will not affect the status of a spousal trust.

22 August 1991 T.I. (Tax Window, No. 8, p. 19, ¶1406)

The spouse is entitled to receive all of the income of the trust only if the sole discretion to receive all or part of the income is in the...

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15 April 1991 T.I. (Tax Window, No. 2, p. 23, ¶1202)

Where a bequest to a surviving spouse is made in addition to the surviving spouse's entitlement under the Family Law Act (Ontario), two valid...

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3 December 1990 Memorandum (Tax Window, Prelim. No. 2, p. 15, ¶1077)

An apartment building and the underlying land generally can be treated as two separate properties, with the result that s. 70(5) can be applied to...

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14 November 1990 T.I. (Tax Window, Prelim. No. 2, p. 10, ¶1042)

Where a deceased taxpayer's surviving spouse receives property from the estate pursuant to his or her equalization right, the property will be...

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14 May 1990 T.I. (October 1990 Access Letter, ¶1466)

Where the surviving spouse has the right to put the shares of the deceased to the other shareholders, and the other shareholders have a call...

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2 April 1990 T.I. (September 1990 Access Letter, ¶1420)

A clause in a will empowering the executors determine whether a particular receipt was on income or capital account serves only to facilitate the...

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19 April 1990 T.I. (July 1990 Access Letter, ¶1324)

After reconsidering its technical interpretation of 7 December 1989, RC was of the view that a designation under s. 104(13.1) or (13.2) and the...

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7 December 1989 T.I. (May 1990 Access Letter, ¶1225)

Where a trust pays the tax liability out of trust income resulting from an s. 104(13.1) designation, the requirements of s. 70(6)(b)(i) will not...

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3 November 89 T.I. (April 90 Access Letter, ¶1173)

A spousal trust will be created where the will directs the establishment of a trust for a spouse that leaves total discretion to the executor to...

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84 C.R. - Q.29

Re usufructs.

80 C.R. - Q.42

If at the time a widow acquires shares under her husband's will, she is bound under a buy-sell agreement to sell them, there is no indefeasible...

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IT-449R "Meaning of 'Vested Indefeasibly'"

Indefeasible vesting where rights held in trust for multiple beneficiaries

1. ... Where property is held in trust for the benefit of one or more...

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Words and Phrases
vest indefeasibly

IT-305R3 "Establishment of Testamentary Spouse Trust"

Locations of other summaries Wordcount
Tax Topics - General Concepts - Payment & Receipt 32

Articles

Elie Roth, Tim Youdan, Chris Anderson, Kim Brown, "Taxation of Trusts Resident in Canada", Chapter 3 of Canadian Taxation of Trusts, (Canadian Tax Foundation), 2016.

Treaty relief from residency requirement in 70(6) – but “will” requirement (p. 171)

Subsection 70(6) applies to a transfer to a taxpayers...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - 101-110 - Section 108 - Subsection 108(3) 374
Tax Topics - Income Tax Act - Section 251.1 - Subsection 251.1(4) - Paragraph 251.1(4)(d) 437
Tax Topics - Income Tax Act - Section 251.1 - Subsection 251.1(1) - Paragraph 251.1(1)(g) - Subparagraph 251.1(1)(g)(ii) 115
Tax Topics - Income Tax Act - Section 164 - Subsection 164(6) 141
Tax Topics - Income Tax Act - Section 112 - Subsection 112(3.2) 331
Tax Topics - Income Tax Act - 101-110 - Section 107 - Subsection 107(1) 144
Tax Topics - Income Tax Act - Section 251.2 - Subsection 251.2(3) - Paragraph 251.2(3)(b) 112
Tax Topics - Income Tax Act - Section 252.2 - Subsection 252.2(2) 115
Tax Topics - Income Tax Act - Section 256 - Subsection 256(7) - Paragraph 256(7)(i) 176
Tax Topics - Income Tax Act - Section 70 - Subsection 70(6) - Paragraph 70(6)(d.1) 161
Tax Topics - Treaties - Income Tax Conventions - Article 29B 239
Tax Topics - Income Tax Act - Section 248 - (2)-(41) 157
Tax Topics - Income Tax Act - Section 248 - Subsection 248(8) 199
Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(4) - Paragraph 104(4)(a.2) 59
Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(4) - Paragraph 104(4)(a.3) 38
Tax Topics - Income Tax Act - Section 118.1 - Subsection 118.1(6) 174
Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(6) 164
Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(24) 163
Tax Topics - Income Tax Act - 101-110 - Section 105 - Subsection 105(1) 91
Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(18) 49
Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(7.01) 66
Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(19) 311
Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(13) 125
Tax Topics - Income Tax Act - Section 20 - Subsection 20(1) - Paragraph 20(1)(bb) 144
Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(2) 379

Paragraph 70(6)(a)

Administrative Policy

30 September 2010 Internal T.I. 2010-0373901I7 F - Bigamie fiscale - transfert de biens au décès

The taxpayer lived with his spouse in Immovables A, but thereafter commenced to live separate and apart from her, but did not divorce from her,...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 40 - Subsection 40(4) - Paragraph 40(4)(b) - Subparagraph 40(4)(b)(i) application of s. 40(4)(b)(i) by both surviving spouse re House A and surviving common-law partner re House B – but not for overlapping years 244

Paragraph 70(6)(b)

Administrative Policy

20 April 2016 External T.I. 2015-0601141E5 - Delay in final distribution from spousal trust

Would a testamentary trust qualify as a spousal trust if the deceased taxpayer’s will deferred the final distribution date for the spousal trust...

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18 April 2005 External T.I. 2004-0093821E5 F - Fiducie créée par testament

Under a mooted spouse trust, the spouse has the exclusive and unconditional right to all annual income but it remains in the spouse's discretion...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - 101-110 - Section 108 - Subsection 108(1) - Testamentary Trust - Paragraph (c) - Subparagraph (c)(i) beneficiary electing not to receive income before it becomes payable does not taint the trust (cf. renouncing income already payable) 288

Articles

Elie Roth, Tim Youdan, Chris Anderson, Kim Brown, "Classification of Trusts for Income Tax Purposes", Chapter 2 of Canadian Taxation of Trusts (Canadian Tax Foundation), 2016.

Right of spouse to enforce payment of income (pp. 90-1)

It seems that the spouse or common-law partner must each year be able to enforce payment...

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Subparagraph 70(6)(b)(ii)

Administrative Policy

7 October 2022 APFF Federal Roundtable, Q.6

Mrs. X's late husband created a testamentary spousal trust. Considering that charitable donations have always been part of Mrs. X's cost of...

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7 October 2020 APFF Roundtable Q. 5, 2020-0852171C6 F - Usufruct of a principal residence

A housing unit is subject to a usufruct created by the Quebec will of Mr. X, with Mr. X’s surviving spouse (Ms. X) being the usufructuary, and...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 54 - Principal Residence - Paragraph (c.1) a deemed s. 248(3) testamentary usufruct trust might access the principal residence exemption on the spousal usufructuary’s death or on her surrendering her interest 409
Tax Topics - Income Tax Act - 101-110 - Section 107 - Subsection 107(4) application of s. 107(4) to termination of deemed s. 248(3)(a) spousal trust 472
Tax Topics - Income Tax Act - Section 248 - Subsection 248(3) application of s. 248(3) to usufruct created by will and terminated by death of usufructuary or surrender by her, or assignment or death by bare owner 286

5 October 2018 APFF Financial Strategies and Instruments Roundtable Q. 7, 2018-0761511C6 F - Rollover to spousal trust on death

The decedent bequeathed, to a spousal trust, insurance policies (for which he had been the policyholder and beneficiary) on the lives of his...

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20 April 2017 External T.I. 2016-0672501E5 F - Usufruct and Use of capital of a trust by a spouse

The will of the Quebec deceased bequeathed the usufruct of rental property (the "Immovable") to his spouse and the bare ownership to his adult...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 248 - Subsection 248(3) - Paragraph 248(3)(a) deemed spousal trust created through will 121

5 October 2012 Roundtable, 2012-0453121C6 F - Fiducie au conjoint-police d'assurance-vie

testamentary trust, with a policy endorsement for the suspension of the payment of premiums throughout its holding by a spousal trust would not in...

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Paragraph 70(6)(d)

Administrative Policy

15 September 2004 Internal T.I. 2004-0075001I7 F - Transfert de bien lors du décès d'un conjoint

In 1994, when the capital cost of a taxpayer’s building was $91,000 and the total depreciation deducted since acquisition was $12,000, the...

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Paragraph 70(6)(d.1)

Articles

Elie Roth, Tim Youdan, Chris Anderson, Kim Brown, "Taxation of Trusts Resident in Canada", Chapter 3 of Canadian Taxation of Trusts, (Canadian Tax Foundation), 2016.

Extinguishing of unused LP losses (pp. 170-171)

Other than for the purposes of paragraph of 98(5)(g), this paragraph [70(6)(d.1)] provides that...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - 101-110 - Section 108 - Subsection 108(3) 374
Tax Topics - Income Tax Act - Section 251.1 - Subsection 251.1(4) - Paragraph 251.1(4)(d) 437
Tax Topics - Income Tax Act - Section 251.1 - Subsection 251.1(1) - Paragraph 251.1(1)(g) - Subparagraph 251.1(1)(g)(ii) 115
Tax Topics - Income Tax Act - Section 164 - Subsection 164(6) 141
Tax Topics - Income Tax Act - Section 112 - Subsection 112(3.2) 331
Tax Topics - Income Tax Act - 101-110 - Section 107 - Subsection 107(1) 144
Tax Topics - Income Tax Act - Section 251.2 - Subsection 251.2(3) - Paragraph 251.2(3)(b) 112
Tax Topics - Income Tax Act - Section 252.2 - Subsection 252.2(2) 115
Tax Topics - Income Tax Act - Section 256 - Subsection 256(7) - Paragraph 256(7)(i) 176
Tax Topics - Income Tax Act - Section 70 - Subsection 70(6) 1201
Tax Topics - Treaties - Income Tax Conventions - Article 29B 239
Tax Topics - Income Tax Act - Section 248 - (2)-(41) 157
Tax Topics - Income Tax Act - Section 248 - Subsection 248(8) 199
Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(4) - Paragraph 104(4)(a.2) 59
Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(4) - Paragraph 104(4)(a.3) 38
Tax Topics - Income Tax Act - Section 118.1 - Subsection 118.1(6) 174
Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(6) 164
Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(24) 163
Tax Topics - Income Tax Act - 101-110 - Section 105 - Subsection 105(1) 91
Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(18) 49
Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(7.01) 66
Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(19) 311
Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(13) 125
Tax Topics - Income Tax Act - Section 20 - Subsection 20(1) - Paragraph 20(1)(bb) 144
Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(2) 379

Subsection 70(6.1)

Subsection 70(6.2) - Election

Cases

Picard v. Lagotte Succession, 2017 QCCS 330 (Quebec Superior Court)

Under the will of his deceased wife, the plaintiff (Picard) was a legatee by particular title of her principal residence as well as of an...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 70 - Subsection 70(6) transfer of estate property to a beneficiary ordered to have “occurred, for tax purposes, at an amount equal to its adjusted cost base” 184

Administrative Policy

12 June 2012 STEP CRA Roundtable, 2012-0442921C6 - STEP CRA Roundtable - June 2012 Q.9

A s. 70(6) election cannot be made in respect of a fractional interest in a property For these purposes each share of a corporation, and all of...

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11 July 2007 External T.I. 2006-0206391E5 F - Choix du paragraphe 70(6.2) - société de personnes

A deceased person held an interest in a family farm partnership. Can the executor elect to have s. 70(6) apply to only a portion of the...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Property each share, unlike a partnership unit, is a distinct property 115

91 C.R. - Q.43

A legal representative can elect with respect to a portion of the shares, and a formal written statement, although preferred, is not required. An...

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6 March 1991 External T.I. 5-910239

RC allows election to be made in respect of a fraction of the total number of identical shares owned by the deceased taxpayer.

90 C.R. - Q55

The representative may not elect with respect to part of a property.

Subsection 70(7)

Subsection 70(8)

Subsection 70(9) - When subsection (9.01) applies

Cases

The Queen v. Boger Estate, 93 DTC 5276, [1993] 2 CTC 81 (FCA)

The will of the deceased taxpayer devised a life interest in some lands (the "home quarter") to his wife and the residue of his estate (including...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - 101-110 - Section 108 - Subsection 108(1) - Trust - Paragraph (g) meaning of "vested" and "indefeasible" 121

See Also

Bouchard Estate v. MNR, 93 DTC 1511, [1993] 2 CTC 3003 (TCC)

In finding that 50% of the lands of the deceased were used in the business of farming immediately before his death, rather than 10% as reassessed...

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Lewis v. MNR, 89 DTC 291, [1989] 2 CTC 2011 (TCC)

In his will a testator gave his wife the rents and profits from a farm until one of his grandsons reached the age of 20, at which time the farm...

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Administrative Policy

8 February 2018 External T.I. 2016-0670841E5 - Inter-generational rollover of farm property

Mr. A, whose adult children also are Canadian residents, operates non-adjacent farms, some owned directly, and the others (also located in Canada)...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 70 - Subsection 70(10) - Share of the Capital Stock of a Family Farm or Fishing Corporation one individual's work can qualify multiple farming corps 134
Tax Topics - Income Tax Act - Section 73 - Subsection 73(4) rollover is available where one individual working on properties of multiple corps or partnerships 134

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...

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Locations of other summaries Wordcount
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
Tax Topics - Income Tax Act - Section 69 - Subsection 69(11) s. 69(11) could apply where devisee sells qualified farm property shortly after receiving it under s. 70(9.01) 178

81 C.R. - Q.37

Where property is held under the terms of a will on trust for a child until he attains a specified age, or to his estate if he does not attain...

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Paragraph 70(9)(a)

Administrative Policy

6 October 2008 External T.I. 2008-0271421E5 F - Terres à bois-plan d'aménagement forestier Québec

Work was carried out on some of the woodlots of a taxpayer, with a forest producer's certificate under s. 120 of the Québec Forest Act and also...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 73 - Subsection 73(3) - Paragraph 73(3)(c) Quebec regional agencies’ plans for forest management plans would generally satisfy s. 73(3)(c), whose “engaged” requirement would be met if such plans did not require work 257
Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Farming woodlot, to be a farm, must focus on the fostering of the stand 95

23 July 2004 External T.I. 2004-0067861E5 F - Transfert d'une terre à bois à un enfant

A taxpayer owning a woodlot received a report from a forestry engineer for a given year setting out the eligible development expenses for the...

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Subsection 70(9.01) - Transfer of farming and fishing property to child

Administrative Policy

25 February 2015 External T.I. 2014-0534681E5 F - Interaction of subsections 69(11) and 70(9.01)

Does s. 69(11) apply where s. 70(9.01) applies? CRA responded (TaxInterpretations translation):

Whether or not the taxpayer's legal representative...

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Subsection 70(9.2)

Administrative Policy

6 October 2006 Roundtable, 2006-0197151C6 F - Acquisition selon convention entre actionnaires

A shareholders' agreement gives children the right to acquire the shares of a farm corporation for $1 after their father's death. If the children...

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Words and Phrases
consequence of the death
Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 248 - Subsection 248(8) - Paragraph 248(8)(a) children exercising right in shareholders’ agreement to acquire shares on father's death would not be a consequence of his death, cf. if pursuant to his will 210

Subsection 70(9.4)

See Also

McCreath Trust v. The Queen, 82 DTC 6294 (FCA)

It was held that the beneficial interest of 4 children in the corpus of a trust which had been established by her 7 years before her death, arose...

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Subsection 70(10) - Definitions

Child

Administrative Policy

4 November 2011 Internal T.I. 2011-0413341I7 F - Bien agricole admissible

In the course of a general discussion, CRA stated:

For the purposes of subsections 70(9) and 70(9.01), the ordinary meaning of the term "child" is...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Farming nursery qualifies as farming if focused on growing rather than selling 107
Tax Topics - Income Tax Act - 101-110 - Section 110.6 - Subsection 110.6(1) - Share of the Capital Stock of a Family Farm or Fishing Corporation - Paragraph (a) - Subparagraph (a)(i) meaning of “actively engaged on a regular and continuous basis” requirement 152
Tax Topics - Income Tax Act - 101-110 - Section 110.6 - Subsection 110.6(1.3) - Paragraph 110.6(1.3)(c) s. 110.6(19) election effected a post-1987 acquisition 159
Tax Topics - Income Tax Act - Section 73 - Subsection 73(3) - Paragraph 73(3)(c) rollover unavailable where taxpayer rented out the land to a farmer 153

Share of the Capital Stock of a Family Farm or Fishing Corporation

Administrative Policy

8 February 2018 External T.I. 2016-0670841E5 - Inter-generational rollover of farm property

The transfers of Canadian farming property or of shares of a family farm or fishing corporation or an interest in a family farm or fishing...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 70 - Subsection 70(9) intergenerational transfer of a farming business can occur where one individual worked on more than one farm 216
Tax Topics - Income Tax Act - Section 73 - Subsection 73(4) rollover is available where one individual working on properties of multiple corps or partnerships 134

24 December 2012 External T.I. 2012-0457881E5 - Share of a capital stock of a family farm

After stating that the comments in 2000-0011595 were still valid, CRA stated:

CRA would take into account the use of a particular property by a...

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1 March 2000 External T.I. 1999-0011375 - Family Farm Corporation

A corporate partner of a partnership carrying on a farming business would be considered to be carrying on that business.

26 March 1991 T.I. (Tax Window, No. 1, p. 17, ¶1171)

Although whether a member of the board of directors of a corporation is to be considered to be actively engaged in the business is a question of...

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Paragraph (a)

Administrative Policy

25 April 2006 External T.I. 2005-0154931E5 F - Action - société agricole familiale

Two unrelated individuals (Mr. X and Mr. Y) who hold 50% respective interests in a general partnership (“S.E.N.C.”) through their respective...

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Paragraph (b)

Administrative Policy

11 February 2014 External T.I. 2014-0517611E5 F - Actions d'une société agricole familiale

In year 1 Father purchased Opco, in year 5 he transferred his shares equally to Child 1 who actively explanted the farming business of Opco along...

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Words and Phrases
principally