I-3 - Taxation Act

Section 690.2 Disposition versions

2011-06-06

690.2. If at a particular time any property of an employee trust, an employee life and health trust or a trust described in subparagraph a.1 of the third paragraph of section 647 is distributed by the trust to a taxpayer who is a beneficiary under the trust as consideration for all or any part of the taxpayer’s interest in the trust, the following rules apply:

(a)  the trust is deemed to have disposed of the property for proceeds of disposition equal to its fair market value at the particular time;

(b)  the taxpayer is deemed to have acquired the property at a cost equal to the proceeds determined in paragraph a in respect thereof;

(c)  the taxpayer is deemed to have disposed of his interest in the trust or part thereof, as the case may be, for proceeds of disposition equal to the adjusted cost base to him of the interest or part thereof, as the case may be, immediately before the particular time;

(d)  for the purposes of sections 93 to 104, 130 and 130.1 and the regulations made under paragraph a of section 130, where the property distributed was depreciable property of a prescribed class of the trust and the amount that was the capital cost of that property to the trust exceeds the cost at which, in accordance with paragraph b, the taxpayer is deemed to acquire the property, the following rules apply:

i.  the capital cost of the property to the taxpayer is deemed to be the capital cost of the property to the trust;

ii.  the excess is deemed to have been allowed to the taxpayer as depreciation in respect of the property for taxation years preceding the acquisition by him of the property.

1982, c. 5, s. 140; 1990, c. 59, s. 245; 2001, c. 7, s. 79; 2003, c. 2, s. 180; 2011, c. 6, s. 145.

2006-03-01

690.2. Where at a particular time any property of an employee trust or a trust described in subparagraph a.1 of the third paragraph of section 647 is distributed by the trust to a taxpayer who is a beneficiary under the trust as consideration for all or any part of the taxpayer’s interest in the trust, the following rules apply:

(a)  the trust is deemed to have disposed of the property for proceeds of disposition equal to its fair market value at the particular time;

(b)  the taxpayer is deemed to have acquired the property at a cost equal to the proceeds determined in paragraph a in respect thereof;

(c)  the taxpayer is deemed to have disposed of his interest in the trust or part thereof, as the case may be, for proceeds of disposition equal to the adjusted cost base to him of the interest or part thereof, as the case may be, immediately before the particular time;

(d)  for the purposes of sections 93 to 104, 130 and 130.1 and the regulations made under paragraph a of section 130, where the property distributed was depreciable property of a prescribed class of the trust and the amount that was the capital cost of that property to the trust exceeds the cost at which, in accordance with paragraph b, the taxpayer is deemed to acquire the property, the following rules apply:

i.  the capital cost of the property to the taxpayer is deemed to be the capital cost of the property to the trust;

ii.  the excess is deemed to have been allowed to the taxpayer as depreciation in respect of the property for taxation years preceding the acquisition by him of the property.

1982, c. 5, s. 140; 1990, c. 59, s. 245; 2001, c. 7, s. 79; 2003, c. 2, s. 180.