I-3 - Taxation Act

Section 529 Disposition versions

2020-09-24

529. Where a partnership disposes of any property (other than an eligible derivative, within the meaning of section 85.8, if subparagraph b of the first paragraph of section 85.7 applies to the partnership) to a taxable Canadian corporation for consideration that includes a share of the capital stock of the corporation, and all the members of the partnership and the corporation make a valid election for the purposes of subsection 2 of section 85 of the Income Tax Act (R.S.C. 1985, c. 1 (5th Suppl.)) in respect of the disposition or, where that election cannot be made by reason of subsection 21.2 of section 13 of that Act, make an election, in the prescribed form referred to in the first paragraph of section 520.1, the provisions of Divisions I to III apply, with the necessary modifications, in respect of the disposition as if the partnership were a taxpayer resident in Canada that had disposed of the property to the corporation.

In addition, for the purposes of the third paragraph of section 520.1 in respect of the disposition, subparagraph a of that paragraph is to be read as if “the taxation year which, of the taxation years of those persons, ends the latest” in the portion before subparagraph i was replaced by “that taxation year of the corporation or the fiscal period of the partnership in which the disposition was made, whichever year or period in the latter case ends later”.

1972, c. 23, s. 412; 1972, c. 26, s. 49; 1975, c. 22, s. 120; 1982, c. 5, s. 122; 1995, c. 63, s. 261; 1997, c. 3, s. 71; 1997, c. 85, s. 93; 2002, c. 40, s. 42; 2003, c. 9, s. 38; 2009, c. 5, s. 179; 2011, c. 34, s. 31; 2020, c. 16, s. 78.

2011-12-09

529. Where a partnership disposes of any property to a taxable Canadian corporation for consideration that includes a share of the capital stock of the corporation, and all the members of the partnership and the corporation make a valid election for the purposes of subsection 2 of section 85 of the Income Tax Act (R.S.C. 1985, c. 1 (5th Suppl.)) in respect of the disposition or, where that election cannot be made by reason of subsection 21.2 of section 13 of that Act, make an election, in the prescribed form referred to in the first paragraph of section 520.1, the provisions of Divisions I to III apply, with the necessary modifications, in respect of the disposition as if the partnership were a taxpayer resident in Canada that had disposed of the property to the corporation.

In addition, for the purposes of the third paragraph of section 520.1 in respect of the disposition, subparagraph a of that paragraph is to be read as if “the taxation year which, of the taxation years of those persons, ends the latest” in the portion before subparagraph i was replaced by “that taxation year of the corporation or the fiscal period of the partnership in which the disposition was made, whichever year or period in the latter case ends later”.

1972, c. 23, s. 412; 1972, c. 26, s. 49; 1975, c. 22, s. 120; 1982, c. 5, s. 122; 1995, c. 63, s. 261; 1997, c. 3, s. 71; 1997, c. 85, s. 93; 2002, c. 40, s. 42; 2003, c. 9, s. 38; 2009, c. 5, s. 179; 2011, c. 34, s. 31.

2009-05-15

529. Where a partnership disposes of any property to a taxable Canadian corporation for consideration that includes a share of the capital stock of the corporation, and all the members of the partnership and the corporation make a valid election for the purposes of subsection 2 of section 85 of the Income Tax Act (R.S.C. 1985, c. 1 (5th Suppl.)) in respect of the disposition or, where that election cannot be made by reason of paragraph 21.2 of section 13 of that Act, make an election, in the prescribed form referred to in the first paragraph of section 520.1, the provisions of Divisions I to III apply, with the necessary modifications, in respect of the disposition as if the partnership were a taxpayer resident in Canada that had disposed of the property to the corporation.

In addition, for the purposes of the third paragraph of section 520.1 in respect of the disposition, subparagraph a of that paragraph is to be read as if “the taxation year which, of the taxation years of those persons, ends the latest” in the portion before subparagraph i was replaced by “that taxation year of the corporation or the fiscal period of the partnership in which the disposition was made, whichever year or period in the latter case ends later”.

1972, c. 23, s. 412; 1972, c. 26, s. 49; 1975, c. 22, s. 120; 1982, c. 5, s. 122; 1995, c. 63, s. 261; 1997, c. 3, s. 71; 1997, c. 85, s. 93; 2002, c. 40, s. 42; 2003, c. 9, s. 38; 2009, c. 5, s. 179.

2006-03-01

529. Where a partnership disposes of any property to a taxable Canadian corporation for consideration that includes a share of the capital stock of the corporation, and all the members of the partnership and the corporation make a valid election for the purposes of subsection 2 of section 85 of the Income Tax Act (Revised Statutes of Canada, 1985, chapter 1, 5th Supplement) in respect of the disposition or, where that election cannot be made by reason of paragraph 21.2 of section 13 of that Act, make an election, in the prescribed form referred to in the first paragraph of section 520.1, the provisions of Divisions I to III apply, with the necessary modifications, in respect of the disposition as if the partnership were a taxpayer resident in Canada that had disposed of the property to the corporation.

In addition, for the purposes of the third paragraph of section 520.1 and sections 520.3 and 522.1 in respect of the disposition, the following rules apply:

(a)  in the case of the third paragraph of section 520.1, subparagraph a of that paragraph shall be read as if the reference in the portion before subparagraph i to “the taxation year which, of the taxation years of those persons, ends the latest”, were a reference to “that taxation year of the corporation or the fiscal period of the partnership in which the disposition was made, whichever year or period in the latter case ends later”;

(b)  in the case of section 520.3, the first paragraph of that section shall be read as if the reference to “who is the transferor” were a reference to “who is a member of the transferor”; and

(c)  in the case of section 522.1,

i.  subparagraphs i of subparagraph a, iii of subparagraph b and i of subparagraph c, of the first paragraph of that section shall be read as if the references to “the taxpayer” and “the disposition is made” were references to “at least one of the members of the taxpayer at the end of the taxpayer’s fiscal period in which the disposition is made” and “that fiscal period ends”, respectively, and

ii.  subparagraphs vii of subparagraph b and iv of subparagraph c, of the first paragraph of that section, and the third paragraph of that section, shall be read as if the reference to “by the taxpayer or” were a reference to “by any member of the taxpayer or the”.

1972, c. 23, s. 412; 1972, c. 26, s. 49; 1975, c. 22, s. 120; 1982, c. 5, s. 122; 1995, c. 63, s. 261; 1997, c. 3, s. 71; 1997, c. 85, s. 93; 2002, c. 40, s. 42; 2003, c. 9, s. 38.