I-3 - Taxation Act

Section 688.4 Disposition versions

2011-06-06

688.4. The rules to which section 688.3 refers, in relation to a trust’s distribution of property, are as follows:

(a)  the trust is deemed to have disposed of the property for proceeds of disposition equal to the adjusted cost base to the trust of the property immediately before the distribution;

(b)  the taxpayer is deemed to have disposed of the taxpayer’s interest as a beneficiary under the trust for proceeds of disposition equal to the cost amount to the taxpayer of the interest immediately before the distribution;

(c)  the taxpayer is deemed to have acquired the property at a cost equal to

i.  if, at all times at which the trust makes a distribution that is a SIFT trust wind-up event, the taxpayer is the only beneficiary under the trust and is a SIFT wind-up entity or a taxable Canadian corporation, the adjusted cost base to the trust of the property immediately before the distribution, and

ii.  in any other case, the cost amount to the taxpayer of the taxpayer’s interest as a beneficiary under the trust immediately before the distribution;

(d)  if the taxpayer’s interest as a beneficiary under the trust was immediately before the disposition taxable Québec property or taxable Canadian property of the taxpayer, the property is deemed to be, at any time that is within 60 months after the distribution, taxable Québec property or taxable Canadian property of the taxpayer, as the case may be; and

(e)  if a liability of the trust becomes as a consequence of the distribution a liability of the corporation described in paragraph b of section 688.3 in respect of the distribution, and the amount payable by the corporation on the maturity of the liability is equal to the amount that would have been payable by the trust on its maturity,

i.  the transfer of the liability by the trust to the corporation is deemed not to have occurred, and

ii.  the liability is deemed to have been issued by the corporation at the time at which, and under the same agreement as that under which, it was issued by the trust, and not to have been issued by the trust.

2010, c. 25, s. 55; 2011, c. 6, s. 144.

2010-10-27

688.4. The rules to which section 688.3 refers, in relation to a trust’s distribution of property, are as follows:

(a)  the trust is deemed to have disposed of the property for proceeds of disposition equal to the adjusted cost base to the trust of the property immediately before the distribution;

(b)  the taxpayer is deemed to have disposed of the taxpayer’s interest as a beneficiary under the trust for proceeds of disposition equal to the cost amount to the taxpayer of the interest immediately before the distribution;

(c)  the taxpayer is deemed to have acquired the property at a cost equal to

i.  if, at all times at which the trust makes a distribution that is a SIFT trust wind-up event, the taxpayer is the only beneficiary under the trust and is a SIFT wind-up entity or a taxable Canadian corporation, the adjusted cost base to the trust of the property immediately before the distribution, and

ii.  in any other case, the cost amount to the taxpayer of the taxpayer’s interest as a beneficiary under the trust immediately before the distribution;

(d)  if the taxpayer’s interest as a beneficiary under the trust was immediately before the disposition taxable Québec property or taxable Canadian property of the taxpayer, the property is deemed to be taxable Québec property or taxable Canadian property of the taxpayer, as the case may be; and

(e)  if a liability of the trust becomes as a consequence of the distribution a liability of the corporation described in paragraph b of section 688.3 in respect of the distribution, and the amount payable by the corporation on the maturity of the liability is equal to the amount that would have been payable by the trust on its maturity,

i.  the transfer of the liability by the trust to the corporation is deemed not to have occurred, and

ii.  the liability is deemed to have been issued by the corporation at the time at which, and under the same agreement as that under which, it was issued by the trust, and not to have been issued by the trust.

2010, c. 25, s. 55.