I-3 - Taxation Act

Section 506 Disposition versions

2006-03-01

506. A corporation resident in Canada which, at any time after 1977, by way of a transaction other than that described in section 505, redeems, acquires or cancels a share of any class of its capital stock, is deemed to pay at that time, on a separate class of shares comprising the shares that are the subject of that transaction, a dividend equal to the amount by which the amount paid for that transaction by the corporation exceeds the paid-up capital in respect of those shares immediately before that time.

1972, c. 23, s. 400; 1978, c. 26, s. 89; 1997, c. 3, s. 71.