I-3 - Taxation Act

Section 1129.70.2 Disposition versions

2020-09-24

1129.70.2. For the purposes of the definition of “real estate investment trust” in the first paragraph of section 1129.70, the following rules apply:

(a)  if an amount is included in the determined gross revenue of a trust for a taxation year and it results from an agreement that can reasonably be considered to have been made by the trust to reduce its risk from fluctuations in interest rates in respect of debt incurred by the trust to acquire or refinance immovable property, the amount is deemed to have the same character as the determined gross revenue in respect of the immovable property and not any other character; and

(b)  where an immovable property is situated in a country other than Canada and either of the following amounts is included in the determined gross revenue of a trust for a taxation year, the amount is deemed to have the same character as the determined gross revenue in respect of the immovable property and not any other character:

i.  the amount that is a gain from fluctuations in the value of the currency of that country relative to Canadian currency recognized on revenue in respect of the immovable property or debt incurred by the trust for the purpose of earning revenue in respect of the immovable property, or

ii.  the amount that results from an agreement that provides for the purchase, sale or exchange of currency, and can reasonably be considered to have been made by the trust to reduce its risk from currency fluctuations described in subparagraph i.

2017, c. 1, s. 386; 2020, c. 16, s. 187.

2017-02-08

1129.70.2. For the purposes of the definition of “real estate investment trust” in the first paragraph of section 1129.70, the following rules apply:

(a)  if an amount is included in the determined gross revenue of a trust for a taxation year and it results from an agreement that can reasonably be considered to have been made by the trust to reduce its risk from fluctuations in interest rates in respect of debt incurred by the trust to acquire or refinance real or immovable property, the amount is deemed to have the same character as the determined gross revenue in respect of the real or immovable property and not any other character; and

(b)  where a real or immovable property is situated in a country other than Canada and either of the following amounts is included in the determined gross revenue of a trust for a taxation year, the amount is deemed to have the same character as the determined gross revenue in respect of the real or immovable property and not any other character:

i.  the amount that is a gain from fluctuations in the value of the currency of that country relative to Canadian currency recognized on revenue in respect of the real or immovable property or debt incurred by the trust for the purpose of earning revenue in respect of the real or immovable property, or

ii.  the amount that results from an agreement that provides for the purchase, sale or exchange of currency, and can reasonably be considered to have been made by the trust to reduce its risk from currency fluctuations described in subparagraph i.

2017, c. 1, s. 386.