663.4. If an amount (in this section referred to as the “SIFT trust’s non-deductible distributions amount for the taxation year”) is determined under subparagraph iv of paragraph a of section 657 for a taxation year, in relation to a SIFT trust, the following rules apply:(a) each beneficiary under the SIFT trust to whom at any time in the year an amount became payable by the trust is deemed to have received at that time a taxable dividend that was paid at that time by a taxable Canadian corporation;
(b) the amount of a dividend that, in accordance with subparagraph a, is deemed to have been received by a particular beneficiary at any time in a taxation year is equal to the amount determined by the formula
A/B × C; and
(c) the amount of a dividend described in subparagraph a in relation to a beneficiary under the SIFT trust is deemed for the purposes of section 663 not to have become payable to the beneficiary.
In the formula in subparagraph b of the first paragraph,(a) A is the amount that became payable at the time determined under that subparagraph b by the SIFT trust to the particular beneficiary;
(b) B is the aggregate of all amounts each of which is an amount that became payable at any time in the taxation year by the SIFT trust to a beneficiary; and
(c) C is the SIFT trust’s non-deductible distributions amount for the taxation year.