I-3, r. 1 - Regulation respecting the Taxation Act

Section 851.22.11r7 Disposition versions

2012-09-01

851.22.11R7. In the event of a winding-up of a subsidiary to which sections 556 to 564.1 and 565 of the Act apply, the following rules apply to the residual portion of a gain or loss of the subsidiary from the disposition of a specified debt obligation to which section 851.22.11 of the Act applies:

(a)  the amount allocated to the taxation year of the subsidiary in which its assets were distributed to its parent on the winding-up, in respect of the residual portion of the gain or loss, is determined on the assumption that the taxation year ended when the assets were distributed to its parent;

(b)  no amount is allocated, in respect of the residual portion of the gain or loss, to any taxation year of the subsidiary after its taxation year in which its assets were distributed to its parent at the time of the winding-up; and

(c)  the amount allocated to the taxation year of the parent in which the subsidiary’s assets were distributed to it at the time of the winding-up, in respect of the residual portion of the gain or loss, is determined on the assumption that the taxation year began when the assets were distributed to it.

O.C. 390-2012, s. 64.