I-3 - Taxation Act

Section 454 Disposition versions

2006-03-01

454. Where at any time a capital property of an individual, other than a trust, is transferred in any of the circumstances to which section 454.1 applies and both the individual and the transferee are resident in Canada at that time, the capital property is deemed to be disposed of at that time by the individual and acquired by the transferee for an amount equal to the adjusted cost base of the capital property immediately before that time or, where the capital property is depreciable property, to the proportion of the undepreciated capital cost of all the property of the same class that the fair market value before that time of the capital property is of the fair market value before that time of the aggregate of all of the property of the same class.

This section does not apply to such a transfer where the taxpayer makes a valid election under subsection 1 of section 73 of the Income Tax Act (Revised Statutes of Canada, 1985, chapter 1, 5th Supplement) to have the provisions of that subsection not apply to the transfer.

1972, c. 23, s. 370; 1979, c. 38, s. 15; 1982, c. 5, s. 108; 1993, c. 16, s. 189; 1994, c. 22, s. 181; 1997, c. 85, s. 76; 2003, c. 2, s. 122.