I-3 - Taxation Act

Section 1129.12.27 Disposition versions

2010-10-27

1129.12.27. Subject to section 1129.12.28, if a qualifying security issued under the cooperative investment plan and held by a partnership is the subject of a redemption by a qualified cooperative after 23 June 2009, an individual who is a member of the partnership at the end of the partnership’s fiscal period in which the redemption is made, is required to pay, for the taxation year in which the fiscal period ends, a tax equal to the amount determined by the formula

[(1,826 - A)/1,826] × B × C.

In the formula in the first paragraph,

(a)  A is the number of days in the period that begins on the issue date of the qualifying security referred to in the first paragraph and that ends on the day on which the qualifying security is redeemed;

(b)  B is the lesser of

i.  25% of the acquisition cost of the qualifying security to the partnership, and

ii.  the amount paid by the qualified cooperative for the redemption of the qualifying security; and

(c)  C is the agreed proportion in respect of the individual for the fiscal period referred to in the first paragraph.

For the purposes of this section, the acquisition cost of the qualifying security to the partnership is the aggregate of the costs determined in respect of the partnership’s members in accordance with section 965.37.1, without taking into account the borrowing costs and the other costs related to its acquisition.

2010, c. 25, s. 210.