I-3 - Taxation Act

Section 858 Disposition versions

2006-03-01

858. Where a beneficiary receives, from a trust under a profit sharing plan at any particular time in its taxation year, an amount which is property other than money, the following rules apply to such property:

(a)  the amount of the cost amount to the trust of the property immediately before such time is deemed to be the proceeds of the disposition of the property therefor;

(b)  that proportion of such portion of the amount received by the beneficiary, as determined in section 857, as is attributable to an amount referred to in any of subparagraphs a to g of the first paragraph of that section, that the cost amount to the trust of the property immediately before the particular time is of the cost amount to the trust of all properties so received by the beneficiary at the particular time, is, subject to paragraph c, deemed to be both the cost to the beneficiary of the property and, for the purposes of section 857, the amount so received by the beneficiary by virtue of the receipt by the beneficiary of the property; and

(c)  where the property is received as consideration for all or a portion of the beneficiary’s interests in the trust and the beneficiary files with the Minister on or before the beneficiary’s filing-due date for the beneficiary’s taxation year that includes the particular time an election in respect of the property, the beneficiary shall include in the cost to the beneficiary of the property determined under paragraph b the least of

i.  the amount by which the unused portion of the beneficiary’s exempt capital gains balance in respect of the trust at the particular time exceeds the aggregate of all amounts each of which is an amount included because of this paragraph in the cost to the beneficiary of another property received by the beneficiary at or before the particular time in the year,

ii.  the amount by which the fair market value of the property at the particular time exceeds the amount deemed by paragraph b to be the cost to the beneficiary of the property, and

iii.  the amount designated in the election in respect of the property.

1973, c. 17, s. 101; 2000, c. 5, s. 189.