Words and Phrases - "consequence of the death"
6 October 2006 Roundtable, 2006-0197151C6 F - Acquisition selon convention entre actionnaires
children’s exercise of a right in a shareholders’ agreement to acquire farmco shares that is triggered on their father’s death would not be a consequence of his death
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 exercise their right to purchase, are those shares transferred or distributed to the children as a consequence of the father's death for the purposes of subsection 70(9.2)? CRA responded:
[T]he acquisition of the shares by a child would be a result of the exercise of the right to purchase arising on death, and not be a consequence of the death of the father. Consequently, subsection 70(9.2) would not apply …
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 |