I-4 - Act respecting the application of the Taxation Act

Section 86 Disposition versions

2005-03-17

86. Where, after 6 May 1974, there has been an amalgamation within the meaning of section 544 of the Taxation Act (chapter I-3) and a taxpayer who, on 31 December 1971 and thereafter without interruption until immediately before the amalgamation, owned a property, in this section referred to as the “old property”, that was a share of the capital stock of a predecessor corporation, an option to acquire such a share, or a bond, debenture, hypothecary claim, mortgage, note or other similar obligation of such corporation, has received as sole consideration for the disposition of such property on the amalgamation, property of the new corporation, in this section referred to as the “new property” which is, respectively, as the case may be, a share of the capital stock of the new corporation, an option to acquire such a share, or a bond, debenture, hypothecary claim, mortgage, note or other similar obligation of the new corporation, the following rules apply, notwithstanding any other provision of this Act or of the Taxation Act, for the purpose of determining the cost to the taxpayer and the adjusted cost base to the taxpayer of the new property:

(a)  the old property is deemed not to have been disposed of by virtue of the amalgamation but to have been instead altered by virtue thereof and to have continued in existence in the form of the new property;

(b)  the new property is deemed not to have been acquired by reason of the amalgamation but to have been in existence prior thereto in the form of the old property that was altered by virtue of the amalgamation.

1973, c. 18, s. 41; 1975, c. 22, s. 279; 1996, c. 39, s. 279; 2005, c. 1, s. 303.

1996-10-30

86. Where, after 6 May 1974, there has been an amalgamation within the meaning of section 544 of the Taxation Act (chapter I-3) and a taxpayer who, on 31 December 1971 and thereafter without interruption until immediately before the amalgamation, owned a property, in this section referred to as the “old property”, that was a share of the capital stock of a predecessor corporation, an option to acquire such a share, or a bond, debenture, obligation secured by mortgage, note or other similar obligation of such corporation, has received as sole consideration for the disposition of such property on the amalgamation, property of the new corporation, in this section referred to as the “new property” which is, respectively, as the case may be, a share of the capital stock of the new corporation, an option to acquire such a share, or a bond, debenture, obligation secured by mortgage, note or other similar obligation of the new corporation, the following rules apply, notwithstanding any other provision of this Act or of the Taxation Act, for the purpose of determining the cost to the taxpayer and the adjusted cost base to the taxpayer of the new property:

(a)  the old property is deemed not to have been disposed of by virtue of the amalgamation but to have been instead altered by virtue thereof and to have continued in existence in the form of the new property;

(b)  the new property is deemed not to have been acquired by reason of the amalgamation but to have been in existence prior thereto in the form of the old property that was altered by virtue of the amalgamation.

1973, c. 18, s. 41; 1975, c. 22, s. 279; 1996, c. 39, s. 279.

1977-12-31

86. Where, after 6 May 1974, there has been an amalgamation within the meaning of section 544 of the Taxation Act and a taxpayer who, on 31 December 1971 and thereafter without interruption until immediately before the amalgamation, owned a property hereinafter called “old property” in the form of a share of the capital stock of a predecessor corporation, an option to acquire such a share, or a bond, mortgage, note or other title of indebtedness of such corporation, has received as sole consideration for the disposition of such property and by virtue of the amalgamation, a property of the new corporation hereinafter called “new property” which is, respectively, as the case may be, a share of the capital stock of the new corporation, an option to acquire such a share, or a bond, mortgage, note or other similar title of indebtedness of the new corporation, the following rules apply, notwithstanding any other provision of this Act or of the Taxation Act for the purposes of determining the adjusted cost base to the taxpayer of the new property:

(a)  the old property is deemed not to have been disposed of by virtue of the amalgamation but to have been instead altered by virtue thereof and to have continued in existence in the form of the new property;

(b)  the new property is deemed not to have been acquired by reason of the amalgamation but to have been in existence prior thereto in the form of the old property that was altered by virtue of the amalgamation.

1973, c. 18, s. 41; 1975, c. 22, s. 279.