I-3 - Taxation Act

Section 1079.1 Disposition versions

2021-12-10

1079.1. In this Book,

“gifting arrangement” means any arrangement under which it may reasonably be considered, having regard to statements or representations made or proposed to be made in connection with the arrangement, that if a person were to enter into the arrangement, the person would

(a)  make a gift to a qualified donee, or a contribution referred to in the first paragraph of section 776, of property acquired by the person under the arrangement; or

(b)  incur a limited-recourse debt that may reasonably be considered to relate to a gift to a qualified donee or a contribution referred to in the first paragraph of section 776;

“limited-recourse debt” in respect of a gift or a contribution described in the first paragraph of section 776 of a taxpayer, at the time the gift or contribution is made, means an amount equal to the aggregate of

(a)  each limited-recourse amount at that time, determined under Title VIII of Book VI, of the taxpayer and of any other taxpayer not dealing at arm’s length with the taxpayer, that can reasonably be considered to relate to the gift or contribution;

(b)  each limited-recourse amount at that time, determined under Title VIII of Book VI when that Title VIII is applied to any other taxpayer dealing at arm’s length with and holds, directly or indirectly, an interest in the taxpayer, that can reasonably be considered to relate to the gift or contribution; and

(c)  each amount that is the unpaid amount at that time of any other indebtedness, of any taxpayer referred to in paragraph a or b, that can reasonably be considered to relate to the gift or contribution if there is a guarantee, security or similar covenant in respect of that or any other indebtedness;

“person” includes a partnership;

“promoter” in respect of a tax shelter means a person who, in the course of a business,

(a)  issues or sells, or promotes the issuance, sale or acquisition of, the tax shelter;

(b)  acts as a mandatary or adviser in respect of the issuance or sale, or the promotion of the issuance, sale or acquisition, of the tax shelter; or

(c)  accepts consideration in respect of the tax shelter;

“tax shelter” means

(a)  a gifting arrangement described in paragraph b of the definition of “gifting arrangement”; and

(b)  a gifting arrangement described in paragraph a of the definition of “gifting arrangement”, or a property, including any right to income, other than a flow-through share or a prescribed property, in respect of which it may reasonably be considered, having regard to statements or representations made or proposed to be made in connection with the gifting arrangement or the property, that, if a person were to enter into the gifting arrangement or acquire an interest in the property, the amount referred to in the second paragraph would, at the end of a particular taxation year that ends within four years after the day on which the gifting arrangement is entered into or the interest is acquired, equal or exceed the amount by which the cost to the person of the property acquired under the gifting arrangement, or of the interest in the property at the end of the particular year, determined without reference to Title VIII of Book VI, would exceed the aggregate of all amounts each of which is the amount of any prescribed benefit that is expected to be received or enjoyed, directly or indirectly, in respect of the property acquired under the gifting arrangement, or of the interest in the property, by the person or any person with whom the person does not deal at arm’s length;

“trust account number” has the meaning assigned by subsection 1 of section 248 of the Income Tax Act (R.S.C. 1985, c. 1 (5th Suppl.));

“trust tax identification number” has the meaning assigned by the second paragraph of section 58.1.1 of the Tax Administration Act (chapter A-6.002).

The amount to which the definition of “tax shelter” in the first paragraph refers is, for the particular taxation year referred to in that definition, the aggregate of all amounts each of which is

(a)  an amount, or a loss in the case of a partnership interest, represented to be deductible in computing the person’s income for the particular year or any preceding taxation year in respect of the gifting arrangement or the interest in the property, including, if the property is a right to income, an amount or loss in respect of that right that is stated or represented to be so deductible; or

(b)  any other amount stated or represented to be deemed under this Part to be paid on account of the person’s tax payable, or to be deductible in computing the person’s income, taxable income or tax payable under this Part, for the particular year or any preceding taxation year in respect of the gifting arrangement or the interest in the property, other than an amount so stated or represented that is included in computing a loss described in subparagraph a.

In this Book, more than one person may act as a tax shelter promoter in respect of the same tax shelter.

1990, c. 59, s. 350; 2000, c. 5, s. 280; 2001, c. 7, s. 153; 2005, c. 1, s. 275; 2009, c. 5, s. 499; 2012, c. 8, s. 241; 2021, c. 36, s. 141.

2012-05-09

1079.1. In this Book,

“gifting arrangement” means any arrangement under which it may reasonably be considered, having regard to statements or representations made or proposed to be made in connection with the arrangement, that if a person were to enter into the arrangement, the person would

(a)  make a gift to a qualified donee, or a contribution referred to in the first paragraph of section 776, of property acquired by the person under the arrangement; or

(b)  incur a limited-recourse debt that may reasonably be considered to relate to a gift to a qualified donee or a contribution referred to in the first paragraph of section 776;

“limited-recourse debt” in respect of a gift or a contribution described in the first paragraph of section 776 of a taxpayer, at the time the gift or contribution is made, means an amount equal to the aggregate of

(a)  each limited-recourse amount at that time, determined under Title VIII of Book VI, of the taxpayer and of any other taxpayer not dealing at arm’s length with the taxpayer, that can reasonably be considered to relate to the gift or contribution;

(b)  each limited-recourse amount at that time, determined under Title VIII of Book VI when that Title VIII is applied to any other taxpayer dealing at arm’s length with and holds, directly or indirectly, an interest in the taxpayer, that can reasonably be considered to relate to the gift or contribution; and

(c)  each amount that is the unpaid amount at that time of any other indebtedness, of any taxpayer referred to in paragraph a or b, that can reasonably be considered to relate to the gift or contribution if there is a guarantee, security or similar covenant in respect of that or any other indebtedness;

“person” includes a partnership;

“promoter” in respect of a tax shelter means a person who, in the course of a business,

(a)  issues or sells, or promotes the issuance, sale or acquisition of, the tax shelter;

(b)  acts as a mandatary or adviser in respect of the issuance or sale, or the promotion of the issuance, sale or acquisition, of the tax shelter; or

(c)  accepts consideration in respect of the tax shelter;

“tax shelter” means

(a)  a gifting arrangement described in paragraph b of the definition of “gifting arrangement”; and

(b)  a gifting arrangement described in paragraph a of the definition of “gifting arrangement”, or a property, including any right to income, other than a flow-through share or a prescribed property, in respect of which it may reasonably be considered, having regard to statements or representations made or proposed to be made in connection with the gifting arrangement or the property, that, if a person were to enter into the gifting arrangement or acquire an interest in the property, the amount referred to in the second paragraph would, at the end of a particular taxation year that ends within four years after the day on which the gifting arrangement is entered into or the interest is acquired, equal or exceed the amount by which the cost to the person of the property acquired under the gifting arrangement, or of the interest in the property at the end of the particular year, determined without reference to Title VIII of Book VI, would exceed the aggregate of all amounts each of which is the amount of any prescribed benefit that is expected to be received or enjoyed, directly or indirectly, in respect of the property acquired under the gifting arrangement, or of the interest in the property, by the person or any person with whom the person does not deal at arm’s length.

The amount to which the definition of “tax shelter” in the first paragraph refers is, for the particular taxation year referred to in that definition, the aggregate of all amounts each of which is

(a)  an amount, or a loss in the case of a partnership interest, represented to be deductible in computing the person’s income for the particular year or any preceding taxation year in respect of the gifting arrangement or the interest in the property, including, if the property is a right to income, an amount or loss in respect of that right that is stated or represented to be so deductible; or

(b)  any other amount stated or represented to be deemed under this Part to be paid on account of the person’s tax payable, or to be deductible in computing the person’s income, taxable income or tax payable under this Part, for the particular year or any preceding taxation year in respect of the gifting arrangement or the interest in the property, other than an amount so stated or represented that is included in computing a loss described in subparagraph a.

In this Book, more than one person may act as a tax shelter promoter in respect of the same tax shelter.

1990, c. 59, s. 350; 2000, c. 5, s. 280; 2001, c. 7, s. 153; 2005, c. 1, s. 275; 2009, c. 5, s. 499; 2012, c. 8, s. 241.

2009-05-15

1079.1. In this Book,

“gifting arrangement” means any arrangement under which it may reasonably be considered, having regard to statements or representations made or proposed to be made in connection with the arrangement, that if a person were to enter into the arrangement, the person would

(a)  make a gift to a qualified donee, or a contribution referred to in the first paragraph of section 776, of property acquired by the person under the arrangement; or

(b)  incur a limited-recourse debt, determined under section 851.41.1, that may reasonably be considered to relate to a gift to a qualified donee or a contribution referred to in the first paragraph of section 776;

“person” includes a partnership;

“promoter” in respect of a tax shelter means a person who, in the course of a business,

(a)  issues or sells, or promotes the issuance, sale or acquisition of, the tax shelter;

(b)  acts as a mandatary or adviser in respect of the issuance or sale, or the promotion of the issuance, sale or acquisition, of the tax shelter; or

(c)  accepts consideration in respect of the tax shelter;

“tax shelter” means

(a)  a gifting arrangement described in paragraph b of the definition of “gifting arrangement” ; and

(b)  a gifting arrangement described in paragraph a of the definition of “gifting arrangement”, or a property, including any right to income, other than a flow-through share or a prescribed property, in respect of which it may reasonably be considered, having regard to statements or representations made or proposed to be made in connection with the gifting arrangement or the property, that, if a person were to enter into the gifting arrangement or acquire an interest in the property, the amount referred to in the second paragraph would, at the end of a particular taxation year that ends within four years after the day on which the gifting arrangement is entered into or the interest is acquired, equal or exceed the amount by which the cost to the person of the property acquired under the gifting arrangement, or of the interest in the property at the end of the particular year, determined without reference to Title VIII of Book VI, would exceed the aggregate of all amounts each of which is the amount of any prescribed benefit that is expected to be received or enjoyed, directly or indirectly, in respect of the property acquired under the gifting arrangement, or of the interest in the property, by the person or any person with whom the person does not deal at arm’s length.

The amount to which the definition of “tax shelter” in the first paragraph refers is, for the particular taxation year referred to in that definition, the aggregate of all amounts each of which is

(a)  an amount, or a loss in the case of a partnership interest, represented to be deductible in computing the person’s income for the particular year or any preceding taxation year in respect of the gifting arrangement or the interest in the property, including, if the property is a right to income, an amount or loss in respect of that right that is stated or represented to be so deductible; or

(b)  any other amount stated or represented to be deemed under this Part to be paid on account of the person’s tax payable, or to be deductible in computing the person’s income, taxable income or tax payable under this Part, for the particular year or any preceding taxation year in respect of the gifting arrangement or the interest in the property, other than an amount so stated or represented that is included in computing a loss described in subparagraph a.

In this Book, more than one person may act as a tax shelter promoter in respect of the same tax shelter.

1990, c. 59, s. 350; 2000, c. 5, s. 280; 2001, c. 7, s. 153; 2005, c. 1, s. 275; 2009, c. 5, s. 499.

2006-03-01

1079.1. In this Book,

“gifting arrangement” means any arrangement under which it may reasonably be considered, having regard to statements or representations made or proposed to be made in connection with the arrangement, that if a person were to enter into the arrangement, the person would

(a)  make a gift to a qualified donee, or a contribution referred to in the first paragraph of section 776, of property acquired by the person under the arrangement; or

(b)  incur a limited-recourse amount that may reasonably be considered to relate to a gift to a qualified donee or a contribution referred to in the first paragraph of section 776;

“limited-recourse amount” has the meaning assigned by Title VIII of Book VI;

“person” includes a partnership;

“promoter” in respect of a tax shelter means a person who, in the course of a business,

(a)  issues or sells, or promotes the issuance, sale or acquisition of, the tax shelter;

(b)  acts as a mandatary or adviser in respect of the issuance or sale, or the promotion of the issuance, sale or acquisition, of the tax shelter; or

(c)  accepts consideration in respect of the tax shelter;

“tax shelter” means

(a)  a gifting arrangement described in paragraph b of the definition of “gifting arrangement” ; and

(b)  a gifting arrangement described in paragraph a of the definition of “gifting arrangement”, or a property, including any right to income, other than a flow-through share or a prescribed property, in respect of which it may reasonably be considered, having regard to statements or representations made or proposed to be made in connection with the gifting arrangement or the property, that, if a person were to enter into the gifting arrangement or acquire an interest in the property, the amount referred to in the second paragraph would, at the end of a particular taxation year that ends within four years after the day on which the gifting arrangement is entered into or the interest is acquired, equal or exceed the amount by which the cost to the person of the property acquired under the gifting arrangement, or of the interest in the property at the end of the particular year, determined without reference to Title VIII of Book VI, would exceed the aggregate of all amounts each of which is the amount of any prescribed benefit that is expected to be received or enjoyed, directly or indirectly, in respect of the property acquired under the gifting arrangement, or of the interest in the property, by the person or any person with whom the person does not deal at arm’s length.

The amount to which the definition of “tax shelter” in the first paragraph refers is, for the particular taxation year referred to in that definition, the aggregate of all amounts each of which is

(a)  an amount, or a loss in the case of a partnership interest, represented to be deductible in computing the person’s income for the particular year or any preceding taxation year in respect of the gifting arrangement or the interest in the property, including, if the property is a right to income, an amount or loss in respect of that right that is stated or represented to be so deductible; or

(b)  any other amount stated or represented to be deemed under this Part to be paid on account of the person’s tax payable, or to be deductible in computing the person’s income, taxable income or tax payable under this Part, for the particular year or any preceding taxation year in respect of the gifting arrangement or the interest in the property, other than an amount so stated or represented that is included in computing a loss described in subparagraph a.

In this Book, more than one person may act as a tax shelter promoter in respect of the same tax shelter.

1990, c. 59, s. 350; 2000, c. 5, s. 280; 2001, c. 7, s. 153; 2005, c. 1, s. 275.