I-3 - Taxation Act

Section 851.10 Disposition versions

2006-03-01

851.10. Where an insurer holds property at the end of its taxation year 1977 in connection with a segregated fund, the following rules apply:

(a)  the insurer is deemed to have disposed of the property on the day referred to in section 851.2 for proceeds equal to its adjusted cost base to the insurer on that day and the segregated fund trust is deemed to have acquired that property on the same day at a cost equal to those proceeds;

(b)  the transaction referred to in paragraph a is deemed to be made between persons not dealing at arm’s length; and

(c)  the insurer is deemed, for the purposes of computing its income for the taxation year 1978, to have paid in the year to its policyholders in satisfaction of their rights under their segregated fund policies, an amount equal to that portion of the amount deducted under paragraph a of section 840 in computing its income for the taxation year 1977 that is in respect of segregated fund policies.

1978, c. 26, s. 165; 1980, c. 13, s. 72; 1996, c. 39, s. 273.