Subsection 104(1) - Reference to trust or estate
Cases
Canada v. Sommerer, 2012 DTC 5126 [at 7219], 2012 FCA 207
Before allowing the taxpayer's appeal from an assessment made on the basis that s. 75(2) applied to attribute a capital gain realized by an...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(5) | 84 | |
| Tax Topics - Income Tax Act - Section 75 - Subsection 75(2) | does not apply to FMV purchases | 236 |
| Tax Topics - Treaties | treaty applies to economic double taxation | 356 |
| Tax Topics - Treaties - Article 13 | attributed gain not included | 415 |
Fundy Settlement v. Canada, 2012 DTC 5063 [at 6881], 2012 SCC 14, [2012] 1 S.C.R. 520, aff'g sub nom St. Michael Trust Corp. v. The Queen, 2010 DTC 5189 [at 7361], 2010 FCA 309, aff'g sub nom Garron v. The Queen, 2009 DTC 1568, 2009 TCC 450
A Barbados-resident corporation was the trustee of two trusts. The Court found that the trusts were resident in Canada because that is where the...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 2 - Subsection 2(1) | central management and control test for trust residence | 262 |
Antle v. Canada, 2010 DTC 5172 [at 7304], 2010 FCA 280
A purported Barbados trust that was used in connection with a tax plan to avoid Canadian capital gains tax on the disposition of shares of a...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - General Concepts - Sham | trust deed did not reflect the factual expectatons of the settler and trustee | 223 |
See Also
Markou v. The Queen, 2016 TCC 137
In connection with a leveraged donation arrangement, the taxpayers in the lending agreement directed the lender (“Capital”) to deliver the...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Statutory Interpretation - Interpretation Act - Section 8.1 | TCC has jurisdiction to determine existence of equitable remedy | 96 |
| Tax Topics - General Concepts - Payment & Receipt | funds in leveraged donation scheme essentially advanced by lender directly to charity | 108 |
Advocate Gen. for Scotland v. Murray Group Holdings Ltd., [2015] CSIH 77, [2015] BTC 36 (Ct. of Ses. (Inner House, 2nd))
In the course of finding that the (Scottish) Inner Court was entitled to decide on questions of English trust law that were relevant to a tax...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 6 - Subsection 6(1) - Paragraph 6(1)(a) | income derived from service is assessable even where agreed to be redirected to 3rd party | 321 |
| Tax Topics - General Concepts - Evidence | Scottish Court of Session entitled to deal with questions of English law | 292 |
Mariano v. The Queen, 2015 DTC 1209 [at 1331], 2015 TCC 244
The taxpayers were participants in leveraged donation transactions which included gifts of courseware licences to a Canadian–resident Trust with...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - General Concepts - Fair Market Value - Other | courseware licences valued at modest initial cost, given relevant wholesale market and depressive effect of huge volumes purchased | 303 |
| Tax Topics - General Concepts - Ownership | no acquisition of unascertained property | 76 |
| Tax Topics - General Concepts - Sham | taxpayer involvement in deceit unnecessary | 375 |
| Tax Topics - Income Tax Act - 101-110 - Section 107 - Subsection 107(2) | delegation of power of appointment to promoter not authorized | 238 |
| Tax Topics - Income Tax Act - Section 118.1 - Subsection 118.1(1) - Total Charitable Gifts | no gift where no intent for impoverishment and where gifted property not yet identified | 566 |
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(35) | attempted use of initial gift to step-up ACB under s. 69(1)(c) | 262 |
Al-Hossain v. The Queen, 2014 TCC 379
To secure mortgage financing for his home purchase, the appellant's friend ("Khandaker") agreed to co-sign the mortgage documents and to be placed...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Excise Tax Act - Section 254 - Subsection 254(2) | co-owner was not occupant and bare trust declaration was too late | 282 |
| Tax Topics - General Concepts - Effective Date | bare trust declaration was too late | 138 |
Sheila Holmes Spousal Trust v. Canada (Attorney General), 2013 ABQB 489
The federal Minister assessed the settlor of the appellant trust on the basis that the trust's taxable capital gain and investment income were...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - General Concepts - Rectification & Rescission | superior court declines jurisdiction in tax dispute | 192 |
Peragine v. The Queen, 2012 DTC 1287 [at 3887], 2012 TCC 348
Webb J. found that the taxpayer held a real property as an agent (and hence as a bare trustee) of his brother. The evidence consistently showed...
Lipson v. The Queen, 2012 DTC 1064 [at 2796], 2012 TCC 20
The taxpayers received a number of capital distributions from the liquidator of their mother's "succession" (a Quebec estate), but only filed a...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 116 - Subsection 116(3) | 184 | |
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Taxable Canadian Property | 184 |
Fourney v. The Queen, 2012 DTC 1019 [at 2575], 2011 TCC 520
Seeking to protect herself from being sued by her brother, the taxpayer transferred title to all her real properties for no consideration to...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - General Concepts - Agency | 191 | |
| Tax Topics - General Concepts - Corporate/Separate Personality | 257 | |
| Tax Topics - General Concepts - Ownership | 257 | |
| Tax Topics - Income Tax Act - Section 163 - Subsection 163(2) | line codes in electronic filings were incomprehensible to taxpayer | 300 |
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Disposition | 257 |
Canpar Developments Inc. v. The Queen, 2011 GSTC 118, 2011 TCC 353 (Informal Procedure)
The taxpayer's transfer of a real property to its two shareholders, made for the purpose of securing a bank loan, did not give rise to an implicit...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Excise Tax Act - Section 285 | 224 |
De Mond v. The Queen, 99 DTC 893, Docket: 95-2216-IT-G (TCC)
The taxpayer settled a trust governed by U.S. law (the “Family Trust”) for the purpose of ensuring that its property could be rolled into...
Administrative Policy
10 June 2016 STEP Roundtable Q. 10, 2016-0645781C6 - US Revocable Living Trusts
A U.S. resident (the “grantor”) settles a “revocable living trust” with property including taxable Canadian property. The grantor: is the...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 70 - Subsection 70(5) | transfer to remainder beneficiary of a U.S. revocable living trust on death does not occur as a consequence of death | 126 |
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(8) - Paragraph 248(8)(a) | remainder beneficary of inter vivos trust | 165 |
4 October 2010 Internal T.I. 2008-0289461I7 - Netherlands Antilles private foundation
A private foundation was created pursuant to the laws of the Netherlands Antilles and governed by Articles of Foundation. Its capital consists of...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Corporation | Netherlands Antilles private foundation qualifies as a trust notwithstanding its separate legal personality | 109 |
2014 Ruling 2013-0496831R3 - Irish Common Contractual Fund
underline;">: Description of CCF. "CCF" is a common contractual fund established pursuant to the Investment Funds, Companies and Miscellaneous...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 96 | Irish common contractual fund respected as co-ownership | 54 |
22 November 2013 External T.I. 2013-0511771E5 - Beneficial Ownership - Disposition
As the taxpayer's daughter did not qualify for a mortgage at the time of her purchase of her home, the bank required legal title to be placed in...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - General Concepts - Ownership | mother as nominee for daughter's house | 94 |
8 May 2012 CALU Roundtable Q. 6, 2012-043564
Shareholders of a corporation use a buy-sell agreement to requires the corporation to acquire insurance on the shareholders' lives (and pay the...
15 July 2010 Internal T.I. 2010-0353701I7 - Classification foreign entity - Trust Enterprise
Ruling that a Liechstenstein Trust Enterprise would be a trust rather than a corporation. Although it had centralized control, continuity of...
2010 Ruling 2009-0345011R3 - Irish Common Contractual Fund
Irish contractual funds, which gave the unitholders proportionate undivided co-ownership interests in the assets of each "sub-fund (i.e.,...
2006 Ruling 2006-0199741R3 - Irish Common Contractual Fund
underline;">: CCF. A Common Contractual Fund ("CCF") is a type of collective investment undertaking under which Unitholders by contractual...
2006 Ruling 2004-0106101R3 - Class of German Arrangement & Treaty Benefits
Ruling that an open-end real estate fund established under the Investment Companies Act (Germany) (and to be continued under the Investment Act...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Treaties - Article 4 | 26 |
2004 Ruling 2004-006777
Ruling that an Irish Common Contractual Fund would be considered to constitute a co-ownership arrangement.
18 February 2002 External T.I. 2001-004607
The purpose of the amendment to s. 104(1) adding "unless the context otherwise requires" was not to make a fundamental change. Although a...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 251.1 - Subsection 251.1(1) | 30 |
10 January 1996 External T.I. 10 January 1996 TI 9518515 - Transfer of Property to Revocable Living Trusts
Would a transfer of appreciated capital property to a revocable inter vivos trust (also referred to as a revocable living trust), which is not a...
IT-216 (Cancelled) "Corporation Holding Property as Agent for Shareholder" 20 May 1975
- A corporation may hold in trust, as agent for a shareholder, property that was acquired specifically to be held in this way. This situation,...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - General Concepts - Effective Date | 85 |
Articles
Donald G.H. Bowman (former Chief Justice of the Tax Court of Canada), "Bare Trusts and Nominee Corporations", Tax Topics (Wolters Kluwer), August 11, 2016, No. 2313, p. 1
Trustee cannot also be an agent (p.4)
My reason for thinking that a trustee holding property or carrying on a business for a beneficiary cannot at...
Jack Bernstein, "Trust Residence Question", Canadian Tax Highlights, Vol. 17, No. 7, July 2009, p. 1
Discussion of CRA audits of residence of inter-provincial trusts.
Subsection 104(2) - Taxed as individual
Cases
Olympia Trust Company v. Canada, 2015 FCA 279
Ryder JA affirmed a finding of Bocock J that a Canadian trust company, which was the trustee for self-directed RRSPs that had purchased shares...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 116 - Subsection 116(5) | RRSP trustee, not annuitant, was the "purchaser" | 200 |
| Tax Topics - General Concepts - Evidence | contract informed by surrounding circumstances | 59 |
Stricker Oolup v. The Queen, 2003 DTC 2142, 2003 TCC 947 (Informal Procedure)
The taxpayer was able to rebut the presumption of resulting trust in favour of the estate when her grandmother, who with the taxpayer had been the...
Patricia M. Fraser v. Her Majesty The Queen, 91 DTC 5123, [1991] 1 CTC 314 (FCTD), aff'd 95 DTC 5684 (FCA)
Approximately 100 taxpayers invested in a pool of mortgages by paying a subscription price for "units" to two companies, that used the proceeds to...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 75 - Subsection 75(2) | 60 |
Smith v. The Queen, 87 DTC 5355, [1987] 2 CTC 138 (FCTD)
Under a shareholder's agreement containing a right of first refusal, it was agreed that the shares held by the taxpayer would be sold in equal...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 173 - Subsection 173(1) | 86 |
Drescher v. The Queen, 85 DTC 5064, [1985] 1CTC 229 (FCTD)
It was found that family members each bought lottery tickets on the understanding that gains would be shared among them. It accordingly was held...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Statutory Interpretation - Provincial Law | 50 |
Bouchard v. The Queen, 83 DTC 5193, [1983] CTC 173 (FCTD)
It was found that real property, which had been purchased by the plaintiff and his wife, had been held by them in trust over a 13-year period for...
Atinco Paper Products Ltd. v. The Queen, 78 DTC 6387, [1978] CTC 566 (FCA)
Gifts were made by the supposed settlor of a trust to her nephews absolutely unencumbered by any limitation on them other than an expressed hope...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - General Concepts - Evidence | 16 | |
| Tax Topics - General Concepts - Tax Avoidance | 56 |
Ablan Leon (1964) Ltd. v. MNR, 76 DTC 6280, [1976] CTC 506 (FCA)
Trusts were not formed when a series of cheques were sent by the supposed settlor to another individual. "From the point of view of the settlor,...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 9 - Nature of Income | 103 | |
| Tax Topics - Income Tax Act - Section 96 | 27 | |
| Tax Topics - Statutory Interpretation - Provincial Law | 95 |
The Queen v. Esskay Farms Ltd., 76 DTC 6010, [1976] CTC 24 (FCTD)
The taxpayer, in order to defer pursuant to s. 20(1)(n) the recognition of gain on the sale of land to the City of Calgary, agreed to sell the...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - General Concepts - Agency | 118 | |
| Tax Topics - General Concepts - Evidence | 75 | |
| Tax Topics - General Concepts - Sham | no sham if documents describe intended legal rights | 338 |
| Tax Topics - General Concepts - Tax Avoidance | no sham if documents describe intended legal rights | 338 |
| Tax Topics - Income Tax Act - Section 20 - Subsection 20(1) - Paragraph 20(1)(n) | 195 | |
| Tax Topics - Income Tax Act - Section 245 - Old | 55 | |
| Tax Topics - Income Tax Act - Section 246 - Subsection 246(1) | 191 | |
| Tax Topics - Statutory Interpretation - Provincial Law | 52 |
Kingsdale Securities Co. Ltd. v. The Queen, 74 DTC 6674, [1975] CTC 10 (FCA)
An alleged settlement of trusts (prior to the date of execution of the trust deeds) did not occur due to the lack of the requisite certainty of...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - General Concepts - Effective Date | 50 | |
| Tax Topics - Income Tax Act - Section 169 | 82 | |
| Tax Topics - Income Tax Act - Section 172 - Subsection 172(2) | 82 | |
| Tax Topics - Income Tax Act - Section 96 | 15 |
Settled Estates Ltd. v. Minister of National Revenue, 60 DTC 1128, [1960] CTC 173, [1960] S.C.R. 606
The combined presumption in ss. 104(1) and (2) that executors are deemed to be individuals for purposes of taxation of the estate did not apply...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Individual | 111 | |
| Tax Topics - Statutory Interpretation - Interpretation Act - Subsection 15(2) | 51 |
See Also
Evoy Estate v. The Queen, 2016 TCC 263
The will of a Canadian-resident individual established three separate testamentary trusts for each of his three children and their respective...
Howard v. Commissioner of Taxation, [2014] HCA 21
The taxpayer and four others formed a joint venture to acquire, lease and sell a golf course. The taxpayer attempted to have a corporation of...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 56 - Subsection 56(4) | agreement assigned rights to proceeds of law suit rather than entitlement under law suit | 305 |
| Tax Topics - Income Tax Act - Section 9 - Compensation Payments | damages not corporate income as not received qua director | 183 |
| Tax Topics - Income Tax Act - Section 9 - Nature of Income | agreement assigned rights to proceeds of law suit rather than entitlement under law suit | 305 |
De Mond Jr. v. The Queen, 99 DTC 893 (TCC)
A trust established by the taxpayer was found to be a bare trust given that he could cause the trust property to revert to him at any time, could...
Collins v. The Queen, 96 DTC 1034 (TCC)
Before rejecting a submission that the taxpayer held half of his shares of a private company on a constructive or resulting trust for his wife,...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - General Concepts - Ownership | 23 | |
| Tax Topics - General Concepts - Substance | 102 |
Karavos v. The Queen, 95 DTC 1001 (TCC)
Before finding that, in any event, the taxpayer had failed to establish that one-half of his interest in a building was held on a constructive...
Gillis v. MNR, 91 DTC 1457 (TCC)
The presumption under common law and s. 21 of the Matrimonial Property Act (Nova Scotia) of resulting trust with respect to a transfer of property...
Nelson v. MNR, 91 DTC 37 (TCC)
Insufficient evidence was advanced to support the taxpayers' position that 1/2 of a farm was held on a constructive trust.
Fraser v. MNR, 89 DTC 620 (TCC)
A vehicle under which a company ("Marlowe-Yeoman") invested in and held mortgages on behalf of investors, who had the right to redeem their...
Zeidler v. Campbell (1988), 29 E.T.R. 113 (Alta. Q.B.)
A voting trust agreement did not give rise to a trust in light inter alia of the fact that the alleged trustee did not acquire any property in the...
Bank of Nova Scotia v. Societé General (Canada), [1988] 4 WWR 232 (Alta. C.A.)
An operator under the 1981 Canadian Association of Petroleum Landmen Operating Procedure held funds received from the non-operators in trust given...
Miconi v. MNR, 85 DTC 696 (TCC)
A real estate property was found to be beneficially owned by the taxpayer rather than by a corporation controlled by him, with the result that...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 15 - Subsection 15(2) | 93 |
Administrative Policy
26 April 2013 External T.I. 2013-0486211E5 - Multiple Trusts
CRA provided general comments respecting several situations where there are several testamentary trusts set up such that the spouse of a deceased...
28 December 2011 External T.I. 2011-0430261E5 - Subsection 104(2) of the Act
where a taxpayer dies leaving his property equally to three testamentary trusts of which his surviving spouse is the only capital and income...
23 February 1999 T.I. 980975
Where "in-trust accounts" are set up by parents for holding mutual fund investments on behalf of their minor children, the certainty of intention...
19 February 1999 Memorandum 983164
Discussion of background to the position in IT-129R, para. 10, respecting the deposit of funds with lawyers pending the outcome of litigation.
22 September 1997 T.I. 971747
Where an "in trust" account is set up to hold a mutual fund investment on behalf of children, the certainty of intention to set up a trust...
Income Tax Technical News, No. 7, 21 February 1996
Where property is held by a bare trust, RC will ignore the trust for income tax purposes and will consider the transferor/settlor to be the owner...
8 March 1995 T.I. 943325 (C.T.O. "Courtesy Election - Whether a Trust")
A courtesy interest in a deceased married woman's estate that the surviving widower elects to receive, is not a trust but, rather, an interest in...
18 February 1994 T.I. 933428 (C.T.O. "Bare Trusts")
Where a settlor transfers property to a trust having the characteristics according with RC's understanding of a bare trust (the settlor is the...
24 February 1993 T.I. (Tax Window, No. 29, p. 14, ¶2439)
The Crown can be constituted a trustee only by the express provisions of an Act of Parliament. Where the Crown is a trustee, the trustee will not...
31 March 1993 T.I. (Tax Window, No. 29, p. 8, ¶2444)
A trust that is a grantor trust for U.S. purposes will be treated as a bare trust for Canadian purposes, with the result that the settlor will be...
25 January 1993 Memorandum (Tax Window, No. 28, p. 22, ¶2398)
Two trusts need not operate concurrently nor need the trustees be the same for a designation under s. 104(2) to be made. Any such designation is...
October 1992 Central Region Rulings Directorate Tax Seminar, Q.Q (May 1993 Access Letter, p. 234)
In order for a bare trust to exist for purposes of the Act, the declaration of trust must have been entered into at the time the property in...
23 January 1992 T.I. (Tax Window, No. 16, p. 21, ¶1712)
A trust under which the trustee does not have any significant powers or responsibilities and does not take any action regarding the trust property...
18 November 1991 Memorandum (Tax Window, No. 11, p. 6, ¶1536)
If a trust is used to achieve a beneficial result for tax purposes not otherwise available to the settlor, this usually is an indication that the...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 102 - Subsection 102(1) | 34 |
10 May 1990 T.I. (October 1990 Access Letter, ¶1471)
Where the parties to an arrangement intend to create a trust for tax purposes and the custodian of the property acts as a trustee under an...
27 October 89 Memorandum (March 1990 Access Letter, ¶1147)
No provision of the Act allows a usufruct to be treated as a trust.
89 C.M.TC - "Bare Trusts"
general discussion
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Disposition | 43 |
88 C.R. - Q.31
A constructive trust is subject to the trust provisions of the Act.
88 C.R. - Q.32
Where a bare trust exists at common law, ss.104(1) and (2) will apply because the transferor transfers the legal title while retaining the...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 75 - Subsection 75(2) | 22 |
80 C.R. - Q.12
A minor cannot hold shares in a corporation and, in an estate freezing context, where a trust is used to hold shares for a minor, then it is...
79 C.R. - Q.24
RC usually considers settlor/beneficiary as the actual owner of the property in a bare trust, except that s. 104(1) or (2) is applied for the...
IT-129R "Lawyers' Trust Accounts and Disbursements"
Where funds are deposited with a lawyer by litigants for safekeeping and investment pending a court order or settlement, the income generated is...
Articles
Keith R. Hennel, "Escrow Arrangements in Acquisition Agreements: What Are You Creating?", CCH Tax Topics, No. 2176, November 21, 2013, p. 1
Whether an escrow arrangement represents a trust (p. 2)
As indicated by other commentators, poorly drafted escrow arrangements have resulted in...
Lipson, "The Bare Trust and the Element of Control", Tax Topics, No. 1214, 15 June 1995, p. 1.
Waters, "An Overview of the Law of Trusts", 1988 Conference Report, c. 35.
Subsection 104(4) - Deemed disposition by trust
See Also
Green v. The Queen, 2012 DTC 1061 [at 2788], 2012 TCC 10 (Informal Procedure)
The taxpayer and his siblings received a real estate property from a testamentary trust on a rollover basis under s. 107(2) and sold the property....
Administrative Policy
14 February 2014 Internal T.I. 2013-0490891I7 - Revocable Living Trust
On a date prior to 1988, the Trust was created and Mother (a U.S. resident) and each of her children (also U.S. residents) transferred their...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Disposition | revocable living trust formed on initial settlement date | 191 |
6 September 2013 External T.I. 2012-0459531E5 - Gross royalty trust units held by an estate
An estate administered by the Public Trustee potentially could remain in existence for more than 21 years. Accordingly, there could be a deemed...
22 March 2013 External T.I. 2012-0473661E5 - Joint Spousal or Common-Law Partner Trust Status
A joint spousal or common-law partner trust will maintain its status after a divorce for purposes of s. 104(4)(a), so that the deemed disposition...
6 December, 1994 T.I. 941969 (C.T.O. "Application of 104(4) to a Non-Resident Trust")
A non-resident trust that is not subject to taxation in Canada is not subject to the deemed disposition rule in s. 104(4), with the result that...
25 April 1994 T.I. 940902 (C.T.O. "Communal Organization and '21-Year Rule' for Trusts")
S.104(4) will not apply to a communal organization which is deemed to be an inter vivos trust pursuant to s. 143(1) because of the exclusion in...
26 January 1994 Internal T.I. 7-933240
S.104(4) also applies to non-resident trusts that own taxable Canadian property.
8 September 1993 T.I. (Tax Window, No. 33, p. 6, ¶2640)
The deemed realization rules in s. 104(4)(b) will apply to charitable and non-profit organizations which are trusts.
31 March 1993 T.I. (Tax Window, No. 29, p. 23, ¶2451)
Although s. 104(4) generally applies to revocable trusts, it does not apply to property held by bare trusts.
22 March 1993 T.I. (Tax Window, No. 29, p. 12, ¶2443)
Where the will of the testator directs the executor and trustee to hold the residue of the estate in trust for the testator's child for life and...
1993 CALU Conference, Q. 2 (C.T.O. "Insurance Policy and Fair Market Value of Shares - CALU")
Where a spousal trust owns shares of a corporation that owns an insurance policy on the life of the spouse, in determining the fair market value...
22 November 1991 T.I. (Tax Window, No. 13, p. 7, ¶1632)
A designation under s. 104(13.1) or (13.2) will not affect the status of a spousal trust.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 70 - Subsection 70(6) | 16 |
Articles
W.P. Goodman, "How to Minimize the Impact of the Deemed Realization of Trust Property", Goodman on Estate Planning, Vol. VII, No. 1, p. 493.
Paragraph 104(4)(a)
See Also
Grimes v. The Queen, 2016 TCC 280
The taxpayer trust was deemed under s. 104(4)(a) to dispose of its property at fair market value. The FMV of its shares of a Holdco wholly-owning...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - General Concepts - Fair Market Value - Shares | no discount for shareholder-level taxes, minority discount re NAL party’s voting control, marketability discount, advances valued at nil given practice of converting to bonuses | 650 |
Administrative Policy
10 June 2016 STEP Roundtable Q. 11, 2016-0645821C6 - Tainting of a Spousal Trust
When asked to comment on the statement in IT-305R4, para. 8:
Once a trust qualifies as a spouse trust under the terms of subsection 70(6), it...
28 November 2010 CTF Roundtable, 2013-0487431C6 - Value of Vote-Only Shares 2010 CTF Conference
CRA generally will ignore any premium that could be attributed to controlling non-participating preference shares, for purposes of subsection...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - General Concepts - Fair Market Value - Shares | premium for voting rights | 170 |
| Tax Topics - Income Tax Act - Section 70 - Subsection 70(5) | 170 |
Articles
Carmen Thériault, "Alter Ego and Joint Partner Trust", 21 Estates, Trusts & Pensions Journal, p. 345.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 75 - Subsection 75(2) | 0 |
Paragraph 104(4)(b)
Administrative Policy
2 June 2011 External T.I. 2011-0399501E5 - TCP distributed by N/R trust to N/R beneficiary
A non-resident inter vivos trust distributes its shares of a private Canadian real estate corporation (Canco) in satisfaction of the capital...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 107 - Subsection 107(2) | 97 | |
| Tax Topics - Income Tax Act - Section 116 - Subsection 116(5) | 139 |
Subsection 104(5.3)
Articles
Edgar, "Deemed Realization of Trust Property: Proposed Amendments to the 21-Year Rule", Estates and Trusts Journal, April 1992, p. 207.
Subsection 104(5.5)
Administrative Policy
September 1992 B.C. Revenue Canada Round Table, Q. 30 (May 1993 Access Letter, p. 228)
S.104(5.5)(b) could have application where an individual is given a nominal absolute interest under a trust or a contingent interest which is...
Tax Professionals Mini Round Table - Vancouver - Q. 30 (March 1993 Access Letter, p. 110)
Discussion of circumstances where s. 104(5.5)(b) may be applied.
25 June 1992 External T.I. 5-921209
S.104(5.5)(a)(ii) would not preclude an individual from being a beneficiary under a trust where the termination of the beneficiary's interest...
Subsection 104(5.6)
Administrative Policy
31 March 1993 T.I. (Tax Window, No. 29, p. 11, ¶2441)
Re situation where one trust is a beneficiary of another.
Subsection 104(5.8) - Trust transfers
Administrative Policy
2016 Ruling 2014-0552321R3 F - Trust to trust Transfer
The transfer of all the assets of an existing inter vivos trust (which was approaching its 21st anniversary) to a new inter vivos trust, whose...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Disposition - Paragraph (f) | para. (f) exception applied on transfer from old discretionary inter vivos family trust to new trust with terms considered to be substantively the same | 782 |
| Tax Topics - Income Tax Act - Section 74.4 - Subsection 74.4(4) | having a trust interest vest indefeasibly in a minor is consistent with the minor not receiving or having any use of the trust capital | 468 |
| Tax Topics - Income Tax Act - 101-110 - Section 108 - Subsection 108(1) - trust - (g) | trust holding property on its 21st anniversary for minors was not subject to s. 104(4) as their shares would have been deemed under the Trust Deed to be irrevocably determined by then | 413 |
29 November 2016 CTF Roundtable Q. 1, 2016-0669301C6 - GAAR & 21-year rule planning
A discretionary trust (Old Trust) that is approaching its 21st anniversary distributes property with an unrealized gain to a corporate beneficiary...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 245 - Subsection 245(4) | avoidance of 21-year rule through 107(2) transfer to corporate beneficiary | 138 |
10 June 2013 STEP Roundtable, 2013-0486001C6 - 2013 STEP CRA Roundtable Question 11
The first deemed disposition day of a pre-1972 non-spousal testamentary trust was deferred until January 1, 1999 through an exempt beneficiary...
8 January 2013 External T.I. 2012-0459621E5 - Deemed disposition day on trust-to-trust transfer
A testamentary trust made an exempt beneficiary election under s. 104(5.3) so that its deemed disposition day was deferred until January 1, 1999....
Subsection 104(5.31)
Administrative Policy
16 September 1996 External T.I. 5-962956
Discussion of procedure for revocation of election.
Subsection 104(6) - Deduction in computing income of trust
Cases
Turcotte v. ARQ, 2015 QCCA 396
An estate received $475,000 from the RRSP of the deceased and paid a legacy bequeathed by the deceased to a charitable foundation of 70% of the...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 118.1 - Subsection 118.1(5) | no s. 104(6) deduction for testamentary gift distributed to charity and deducted under s. 118.1(5) | 69 |
Administrative Policy
29 November 2016 CTF Roundtable Q. 14, 2016-0669871C6 - Estate distribution
CRA considers that the residue of the Estate can include income and that such income generally can be made payable to a residual beneficiary, so...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(24) | income may not be payable to beneficiary if estate required to pay taxes thereon | 309 |
10 June 2016 STEP Roundtable Q. 12, 2016-0634921C6 - Phantom Income
As deemed income (e.g., a capital gain deemed to arise under a s. 48.1 election on the IPO of a Canadian-controlled private corporation) is not...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(24) | distributions of phantom income must be authorized and effected under the trust deed | 206 |
10 July 2013 Internal T.I. 2013-0475501I7 F - Amounts returned to trustee/beneficiary
Father and Y were the trustees of a Quebec family trust, whose beneficiaries included father and his three children. Distributions made by the...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(13) | distributions to children immediately paid to father | 174 |
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(24) | distributions to children immediately paid to father | 174 |
| Tax Topics - Income Tax Act - 101-110 - Section 105 - Subsection 105(1) | distributions to children immediately paid to father | 146 |
| Tax Topics - Income Tax Act - Section 56 - Subsection 56(2) | distributions to children immediately paid to father | 114 |
2007 Ruling 2007-024528
After the acquisition of a mutual fund trust (the "Fund") by Bidco, the Fund sells all its assets, including an interest in a limited partnership,...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(21) | trustees making filings on behalf of terminated fund | 48 |
| Tax Topics - Income Tax Act - Section 20 - Subsection 20(1) - Paragraph 20(1)(c) | assumed debt traceable to capital distribution | 97 |
| Tax Topics - Income Tax Act - Section 80 - Subsection 80(1) | 90 | |
| Tax Topics - Income Tax Act - Section 80 - Subsection 80(5) | 90 |
2007 Ruling 2007-022420
Trust agreements are amended to provide that the trustee shall allocate all or a portion of net capital gains realized by the trust in the year to...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(7.1) | 108 |
2003 Ruling 2003-000348
The Declaration of Trust of a mutual fund trust is amended to provide that on redemption of units, the unitholders will be paid a proportionate...
2002 Ruling 2001-009107 - Mutual fund trust - capital gains
The trust agreement respecting a mutual fund trust is amended to provide that where units of the fund are redeemed, a portion of the redemption...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 132 - Subsection 132(4) - Capital Gains Redemption | A of formula to redeemed unitholder reduced by any amount of allocated capital gains | 146 |
1997 Ruling 971128
Income arising under s. 94.1 to a Canadian resident trust may be deducted under s. 104(6) if, under the trust indenture, the amount in question is...
12 December 1996 T.I. 962934
Where preferred shares are distributed, the amount of the distribution will be the fair market value of the preferred shares.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(21) | 62 |
IT-381R2 "Trusts - Deduction of Amounts Paid or Payable to Beneficiaries and Flow-Through of Taxable Capital Gains to Beneficiaries"
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(21.2) | 0 |
Articles
Gabrielle Richards, "Executor's Year", Canadian Current Tax, October 1987, p. J49
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(24) | 0 |
Subsection 104(7.01) - Trusts deemed to be resident in Canada
Administrative Policy
25 July 2014 Internal T.I. 2013-0513641I7 - Deemed resident trust under subsection 94(3)
The Estate of a Canadian resident, with two of his children as (apparently non-resident) beneficiaries (A and B), was not resident in Canada by...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 120 - Subsection 120(1) | addition for s. 94 deemed trust | 154 |
| Tax Topics - Income Tax Act - Section 94 - Subsection 94(3) - Paragraph 94(3)(g) | Part XIII withholding treated like Part I instalment | 151 |
Subsection 104(7.1) - Capital interest greater than income interest
Administrative Policy
2015 Ruling 2015-0578051R3 - Variation of trust indenture
The Declaration of Trust of the Fund, which is a listed closed-end mutual fund trust (with one class of units) not holding non-portfolio property,...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Disposition | addition of preferred units not disposition | 83 |
2014 Ruling 2014-0518521R3 - Issuance of a new class of units - Hedged Class
An open-end mutual fund trust ("Fund 1") investing in senior floating rate loans around the world will add a class of units (the "Hedged Class")...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Disposition | addition of FX-hedged units | 152 |
2012 Ruling 2011-0429611R3 - Variation of Trust Indenture
An open end (as described in s. 108(2)(a)) mutual fund trust (the Trust), whose units (the Units) trade on an exchange, wishes to qualify as a...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 108 - Subsection 108(2) - Paragraph 108(2)(b) | application of asset tests to sub LPs; special voting unit | 390 |
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Disposition | reclassification of preferred REIT units | 298 |
2012 Ruling 2011-0410181R3 - Variation of trust indenture
An open end (as described in s. 108(2)(a)) mutual fund trust (the Trust), whose units (the Units) trade on a stapled basis with a second open-end...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 108 - Subsection 108(2) - Paragraph 108(2)(b) | conversion of note to satisfy 10% test/partnership look-through | 291 |
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Disposition | addition of preferred units | 210 |
12 October 2012 External T.I. 2012-0448351E5 - treatment of trailer fee rebates
A mutual fund trust pays commissions ("DSC Commissions") to the dealer through whom its units were purchased and also pays an annual trailer fee. ...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(13) | MFT fee rebate | 195 |
| Tax Topics - Income Tax Act - Section 12 - Subsection 12(2.1) | no s. 12(2.1) inclusion if MFT fee rebate paid directly to large investor as trust distribution | 195 |
2011 Ruling 2010-0389921R3 - New series of units - US dollar and Hedged
in order to permit some unitholders (who have US dollars to invest) to achieve a return in US dollars that is the same as the Canadian market...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Disposition | 211 |
2010 Ruling 2010-0361771R3 - Variation of trust indenture
A closed-end mutual fund trust intends to qualify as a REIT. The beneficial interests in the trust currently consist of only one class of units...
2007 Ruling 2007-022420
Trust agreements are amended to provide that the trustee shall allocate all or a portion of net capital gains realized by the trust in the year to...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(6) | gains allocated to redeemed units | 169 |
2004 Ruling 2004-007431
Members of the public subscribe for Class A redeemable units of a mutual fund trust (the "Fund"). A holding corporation for a vendor group...
2001 Ruling 2001-010847
A unit trust whose purpose was to raise financing for a corporation has one class of units that are held by the public and another class of units...
ATR-65 CANCELLED 20 April 1995
The management agreements between open end mutual fund trusts (the "Funds") and their "Manager" will be amended to provide that the Manager may...
Articles
Carrie Smit, "Recent Transactions of Interest", 2011 Canadian Tax Foundation Conference Report, C. 10
In early 2011 RioCan successfully completed the issuance of 5 million series A units for gross proceeds of $125 million. …
Subsection 104(7.1),...
Botz, "Mutual Fund Trusts and Unit Trusts: Selected Tax and Legal Issues", 1994 Canadian Tax Journal, Vol. 42, No. 4, p. 1037.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 108 - Subsection 108(2) - Paragraph 108(2)(a) | 0 | |
| Tax Topics - Income Tax Act - Section 52 - Subsection 52(6) | 0 |
Goodman, "The Tax Treatment of Commercial Trusts", 1989 Canadian Tax Journal, July-August issue, p. 1053
Subsection 104(8)
Cases
Re Liberal Petroleums Trust (1985), 21 E.T.R. 90 (Alta.Q.B.)
Income taxes were paid by a unit trust as a consequence of s. 104(8). Since the trust deed required the trustee to pay the taxes imposed on the...
Subsection 104(13) - Income of beneficiary
Cases
Brown v. The Queen, 79 DTC 5421, [1979] CTC 476 (FCTD)
If a trust does not deduct pursuant to s. 104(6) an amount payable to its beneficiary, that amount is nevertheless taxable in the hands of the...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - General Concepts - Estoppel | 78 | |
| Tax Topics - Income Tax Act - Section 152 - Subsection 152(1) | 44 | |
| Tax Topics - Statutory Interpretation - Interpretation Bulletins, etc. | 45 |
See Also
Pope & Ors v. R & C Commrs., [2012] UKUT 206 (Tax and Chancery Chamber)
The son of the taxpayer, who was the beneficiary of his own life insurance policy, likely died in 1998 when he was abducted by Angolan rebels, but...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 12 - Subsection 12(1) - Paragraph 12(1)(c) | 296 |
Gros v. The Queen, 2012 DTC 1110 [at 3059], 2012 TCC 14 (Informal Procedure)
The taxpayer held units of a listed mutual fund trust (Fording Canadian Coal Trust), which disposed of all its assets to Teck Cominco Ltd. in a...
Joseph v. The Queen, 2010 DTC 1229 [at 3649], 2010 TCC 350 (Informal Procedure)
A unit trust ("Fording") of which the taxpayer was a unitholder agreed to a cash and stock takeover bid from Teck Cominco, as a result of which...
Administrative Policy
2015 Ruling 2015-0570291R3 - Foreign tax credit on income from a trust
As a result of the death of an individual who had previously become resident in the U.S. (the "Settlor"), and who was the sole contributor to a...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 126 - Subsection 126(7) - Non-Business-Income Tax | withholding on IRA proceeds | 65 |
16 June 2014 STEP Roundtable, 2014-0523001C6 - Trusts structured to invoke 75(2)
An "evil trust" is structured to deliberately cause the application of subsection 75(2), so as to cause the attribution of dividend income to a...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 75 - Subsection 75(2) | Brent Kern schemes don't work even if Sommerer issue fixed | 423 |
10 July 2013 Internal T.I. 2013-0475501I7 F - Amounts returned to trustee/beneficiary
Father and Y were the trustees of a Quebec family trust, whose beneficiaries included father and his three children. Distributions made by the...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(24) | distributions to children immediately paid to father | 174 |
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(6) | distributions to children immediately paid to father | 172 |
| Tax Topics - Income Tax Act - 101-110 - Section 105 - Subsection 105(1) | distributions to children immediately paid to father | 146 |
| Tax Topics - Income Tax Act - Section 56 - Subsection 56(2) | distributions to children immediately paid to father | 114 |
16 October 2012 External T.I. 2012-049061E5
A mutual fund trust pays a base level of managament fees to a fund manager, but pays a reduced effective rate in respect of unitholders with large...
12 October 2012 External T.I. 2012-0448351E5 - treatment of trailer fee rebates
A mutual fund trust pays commissions to the dealer through whom its units were purchased and also pays an annual trailer fee. However, the dealer...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(7.1) | MFT fee rebate paid directly to large investor as trust distribution | 263 |
| Tax Topics - Income Tax Act - Section 12 - Subsection 12(2.1) | no s. 12(2.1) inclusion if MFT fee rebate paid directly to large investor as trust distribution | 195 |
2 October 2012 External T.I. 2012-0448021E5 - Distribution by a non-resident trust
Given that "[p]aragraph 250.1(b) of the Act generally provides that where income is to be determined under the Act for a non-resident person, it...
10 August 2012 External T.I. 2012-0453041E5 - Income recognition-mutual fund beneficiary
A spousal testamentary trust with a March 31, 2013 taxation year end would report income will include income that became payable to it in January...
2004 STEP Roundtable Q. 3, 2004-0069951C6
While a trust's income is determined in accordance with the Act, the amount payable to the beneficiary is determined in accordance with the trust...
6 June 2003 Internal T.I. 2002-0183437 - Distributions from non-resident trust
In commenting on whether the Canadian resident beneficiary received an amount out of income or capital in the context of the situation where there...
24 March 1994 T.I. 940285 (C.T.O. "Distributions from Foreign Trusts")
Income distributions received by a Canadian resident from a non-resident trust or mutual fund trust are generally included in income as income...
IT-85R2 "Health and Welfare Trusts for Employees"
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 6 - Subsection 6(1) - Paragraph 6(1)(a) | 0 |
Articles
Bowman, "Sophisticated Estate-Planning Techniques: Cross-Border Dimensions", 1993 Conference Report, pp. 38-20-21:
Comparison of the taxation of resident trusts under s. 104(13)(a) and non-resident trusts under s. 104(13)(c).
Subsection 104(13.1) - Amounts deemed not paid
See Also
Lussier v. The Queen, 2000 DTC 1677 (TCC)
An estate sent a letter in November 1994 amending its returns for 1992 and 1993 to make designations under s. 104(13.1), with the intended effect...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 150 - Subsection 150(1) - Paragraph 150(1)(c) | late designation by letter was valid return amendment | 88 |
Administrative Policy
19 September 2015 STEP Roundtable, Q.5
Does s. 104(13.3) establish that designations under s. 104(13.1) or (13.2) can only be made so as to apply non-capital or capital losses of other...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(13.2) | late s. 104(13.2) designation to utilize capital loss carryback | 79 |
IT-342R "Trusts-Income Payable to Beneficiaries"
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(13.2) | 0 | |
| Tax Topics - Income Tax Act - Section 210.2 - Subsection 210.2(1) | 0 |
13 May 1998 T.I. 971832
"Subsection 104(13.1) permits a trust to deduct less than the full amount of its income payable to a beneficiary and thus choose to have that...
15 January 1998 T.I. 972921
S.104(13.1) permits different amounts to be designated for each beneficiary, but only to the maximum amount determined by formula. This is...
7 March 1996 T.I. 960678
Where a designation has been made under s. 104(13.1) in respect of an amount payable to the beneficiary, that amount is considered not to have...
8 April 1993 T.I. 923634
Where a spouse is entitled to receive all the income of a testamentary spousal trust but revokes in writing his or her right to receive such...
19 September 1991 Internal T.I. 7-912069
In response to a suggestion that "if no amount is paid to the beneficiaries, no 104(13.1) designation would be possible because the formula would...
2 May 1995 External T.I. 5-950139
"Where a trust is a spousal trust the designation under subsection 104(13.1) ... would not in and by itself, disqualify the trust as a spousal...
25 April 1990 Memorandum (September 1990 Access Letter, ¶1427)
There is nothing in s. 104(13.1) to restrict trusts and estates utilizing that provision to enjoy the use of lower marginal tax rates applicable...
19 April 1990 T.I. (September 1990 Access Letter, ¶1426)
In a situation where a trust has two equal beneficiaries who share income equally, and of the trust income of $10,000, the trust has deducted...
7 December 1989 T.I. (May 1990 Access Letter, ¶1225)
Discussion of various consequences where a beneficiary makes a payment to the trustee to enable the trustee to pay the tax liability of a trust...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 108 - Subsection 108(1) - Testamentary Trust | 58 | |
| Tax Topics - Income Tax Act - Section 70 - Subsection 70(6) | 53 |
Subsection 104(13.2) - Idem [Amounts deemed not paid]
Administrative Policy
10 June 2016 STEP Roundtable Q. 5, 2016-0634901C6 - Subsection 104(13.3)
A trust carries back an allowable capital loss realized in a subsequent year and files a late s. 104(13.2) designation to include in its income a...
19 September 2015 STEP Roundtable, Q. 6(a)
Can a taxable capital gain which is deemed to be payable to an individual (causing a deemed disposition) under s. 104(13.4)(b)(i) be offset...
19 September 2015 STEP Roundtable, Q.5
CRA accepts that if a trust has pushed out income to its beneficiaries in Year 1 and in, say, Year 3, realizes a non-capital or capital loss, it...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(13.1) | late s. 104(13.1) designation to utilize loss carryback | 201 |
IT-342R "Trusts-Income Payable to Beneficiaries"
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(13.1) | 0 | |
| Tax Topics - Income Tax Act - Section 210.2 - Subsection 210.2(1) | 0 |
Subsection 104(13.3)
Administrative Policy
25 July 2016 External T.I. 2016-0630781E5 - 104(13.3) and a CPP/QPP death benefit
After confirming that, by virtue of the new s. 104(13.3), “the option to include [a] CPP/QPP death benefit in income on a T3 return will no...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(24) | executor's year would not preclude a CPP death benefit from being payable to the beneficiaries in the year | 251 |
Articles
Gary I. Biasini, "The Trust is Dead, Long Live The Trust", Tax Topics (Wolters Kluwer CCH), Number 2227, November 13, 2014, p. 1.
Use of s. 104(13.1) designation to shift income to Alberta trust (p.4)
Consider a situation where a husband and wife (each Manitoba residents and...
Paragraph 104(13.4)(b)
Administrative Policy
19 September 2015 STEP Roundtable, Q.6(b)
How does trust income - deemed under s. 104(13.4)(b)(i) to be payable to the individual - become his or her income given that the individual is...
Finance
Subsection 104(14) - Election by trust and preferred beneficiary
Cases
Sachs v. The Queen, 80 DTC 6291, [1980] CTC 358, 80 DTC 6291 (FCA)
Where preferred beneficiary elections have been made jointly by a trust and the children of the settlor there has "been an exercise of the...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 74.1 - Subsection 74.1(2) | 164 |
Administrative Policy
10 June 2016 STEP Roundtable Q. 4, 2016-0645801C6 - QDT & pref beneficiary election
Each of four grandparents of a disabled grandchild establishes a trust for the grandchild individual under their will, with one of the trusts...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 122 - Subsection 122(3) - qualified disability trust | preferred beneficiary and QDT elections not mutually exclusive | 80 |
87 C.R. - Q.9
It may be possible for capital beneficiaries who are not otherwise entitled to share in the income of the trust to elect in respect of trust...
87 C.R. - Q.10
A distribution to a beneficiary other than the beneficiary who elected will not necessarily render the election invalid.
IT-394R "Preferred Beneficiary Election"
Subsection 104(15) - Allocable amount for preferred beneficiary
Paragraph 104(15)(b)
Administrative Policy
24 July 1992 External T.I. 5-921590
A clause in the trust deed allowing the trust deed to encroach upon capital in favour of one or more of the beneficiaries constitutes a...
87 C.R. - Q.11
The phrase "to share equally in any income of the trust" is not interpreted to mean "to share equally in the accumulating income of the trust."
84 C.R. - Q.33
An alternate beneficiary who has succeeded to the income rights of a deceased discretionary beneficiary will be considered to be a discretionary...
Paragraph 104(15)(d)
Administrative Policy
86 C.R. - Q.55
A trust may not allocate CCA to a beneficiary that is greater than his income from the trust.
Subsection 104(18) - Trust for minor
Administrative Policy
19 February 2014 External T.I. 2013-0500561E5 F - Payment to a subtrust for minor
The beneficiaries of a family discretionary trust are secondary trusts each of which has an infant beneficiary. The income of a secondary trust...
13 June 1995 Memorandum 951422 (C.T.O. "Payment into Court by an Estate for Deceased's Children")
Where pension income received by an estate is paid pursuant to a court order into the court for the benefit of the deceased's minor children, s....
Articles
Jack Bernstein, "Benefitting Beneficiaries", CA Magazine, March 1996, p. 24.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(24) | 0 |
Subsection 104(19) - Designation in respect of taxable dividends
Administrative Policy
3 June 2016 External T.I. 2016-0647621E5 F - Dividend designation from a trust - timing
On May 31, 20X1 (the last day of its taxation year), Opco pays a dividend of $10,000 to a family trust, which immediately distributes that amount...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 186 - Subsection 186(1) - Paragraph 186(1)(a) | dividend distributed by a trust to a connected corporation can be subject to Part IV tax due to the delayed implied effective date of s. 104(19) designations | 115 |
14 January 2013 External T.I. 2012-0465131E5 - Dividend designation from a trust
In response to an inquiry "as to when a taxable dividend will be considered to have been received by a beneficiary of a trust where the dividend...
Income Tax Technical News, No. 41, 23 December 2009
"Eligible Dividend Designation - Subsection 89(14)": A taxable dividend, designated as an eligible dividend under s. 89(14) that is paid to a...
25 April 1991 Memorandum (Tax Window, No. 2, p. 23, ¶1215)
A trust can make the designation under s. 104(19) in favour of a non-resident beneficiary, and such designation will not result in an undue...
IT-372R "Trusts - Flow Through of Taxable Dividends and Interest to a Beneficiary"
Subsection 104(20) - Designation in respect of non-taxable dividends
Administrative Policy
14 May 2013 External T.I. 2012-0469591E5 F - Capital dividend received by a trust and CDA
A Canadian-controlled private corporation paid a capital dividend to its sole shareholder, a trust, in 20x1. The beneficiaries of the trust were...
Subsection 104(21) - Designation in respect of taxable capital gains
Administrative Policy
24 March 2015 External T.I. 2012-0470991E5 F - Mutual fund trust
Would a s. 39(4) election apply even if a mutual fund trust was a "day trader" that used margin? CRA stated (TaxInterpretations...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 132 - Subsection 132(6) | day trading included in investment undertaking | 62 |
| Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(a) - Income-Producing Purpose | 67 | |
| Tax Topics - Income Tax Act - Section 39 - Subsection 39(5) - Paragraph 39(5)(a) | 183 | |
| Tax Topics - Income Tax Act - Section 9 - Capital Gain vs. Profit - Shares | 94 |
16 June 2014 STEP Roundtable, 2014-0523061C6 - Trust audit issues
CRA noted that 2014-051719117 concerned a discretionary family trust (of which father and the adult children were capital and income...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 105 - Subsection 105(1) | benefit conferred when trust shares redeemed at undervalue | 196 |
| Tax Topics - Income Tax Act - Section 112 - Subsection 112(3.2) | taxpayer stuck with two-transaction form | 155 |
| Tax Topics - Income Tax Act - Section 118.1 - Subsection 118.1(1) - Total Charitable Gifts | executors lacked power to make gift | 92 |
| Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(a) - Legal and other Professional Fees | legal and accounting expenses | 45 |
| Tax Topics - Income Tax Act - Section 75 - Subsection 75(2) | settlor taking back undervalued freeze shares | 76 |
25 February 2014 Internal T.I. 2014-0517191I7 - Late or amended 104(21) designation
Following the filing of its T3 return, a discretionary family trust purported to make 104(21) and (21.2) designations respecting the net taxable...
2007 Ruling 2007-024528
Ruling that following the redemption of all the outstanding units of an income fund, any document that the fund is required to file under the Act...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(6) | realization and distribution of target MFT gain | 101 |
| Tax Topics - Income Tax Act - Section 20 - Subsection 20(1) - Paragraph 20(1)(c) | assumed debt traceable to capital distribution | 97 |
| Tax Topics - Income Tax Act - Section 80 - Subsection 80(1) | 90 | |
| Tax Topics - Income Tax Act - Section 80 - Subsection 80(5) | 90 |
1998 Strategy Institute Round Table 981493
A beneficiary's entitlement to only the taxable portion (75%) of a capital gain of a trust would not affect the amount available to be designated...
12 December 1996 T.I. 962934
Where a trust realizes a capital gain on distributing preferred shares to beneficiaries who are both income and capital beneficiaries pursuant to...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(6) | 22 |
12 April 1995 External T.I. 5-941713
Taxable capital gains of a mutual fund trust designated to a non-resident unitholder under s. 104(21) would not be taxable in Canada.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 118.9 - Subsection 118.9(4) | 10 | |
| Tax Topics - Income Tax Act - Section 212 - Subsection 212(11) | 23 | |
| Tax Topics - Treaties - Article 22 | 27 |
28 June 1993 T.I. (Tax Window, No. 32, p. 11, ¶2605)
A capital gain realized by a trust will be allocated in accordance with the trust deed or, if the trust deed is silent, to the income...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 118.1 - Subsection 118.1(6) | 20 |
IT-381R3 "Trusts - Deduction of Amounts Paid or Payable to Beneficiaries and Flow-Through of Taxable Capital Gains to Beneficiaries" 14 February 1997
5
A trust that has realized taxable capital gains in a particular taxation year may, within the limits of subsection 104(21), designate in its...
Forms
Subsection 104(21.2) - Beneficiaries’ taxable capital gain
Administrative Policy
23 June 2015 External T.I. 2015-0571801E5 F - Allocation of Capital Gains to Beneficiaries
A discretionary family trust, with Mr., his wife and their children and grandchildren as beneficiaries, disposes of qualified small business...
29 April 2014 External T.I. 2014-0518951E5 F - Taxable capital gain designation from a trust
A testamentary trust disposed of qualified small business corporation shares in 2013 during its taxation year ending January 31, 2014. Would the...
IT-381R2 "Trusts - Deduction of Amounts Paid or Payable to Beneficiaries and Flow-Through of Taxable Capital Gains to Beneficiaries"
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(6) | 0 |
Subsection 104(22) - Designation in respect of foreign source income
Administrative Policy
IT-506 "Foreign Income Taxes as a Deduction From Income" 5 January 1987
- … Since the rules in subsection 104(22) apply only to that subsection and to section 126, a beneficiary may not utilize the provisions of...
2005 Ruling 2004-0106481R3 - Employee benefit plan-Shares
Employees ("Participants") of the "Corporation," which is resident in Canada, or of the Corporation's non-resident listed parent (the "Parent") or...
IT-201R2 "Foreign Tax Credit — Trust and Beneficiaries" 12 February 1996
- Subsection 104(22) allows a trust to designate its foreign source income for a taxation year to its beneficiaries provided the trust was resident...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(22.1) | 135 |
Articles
Manjit Singh, Andrew Spiro, "The Canadian Treatment of Foreign Taxes", 2014 Conference Report, (Canadian Tax Foundation), 22:1-37
Pure flow-through structure for designation of foreign business income (p 15)
An alternative to this structure [Canadian LP atop US LP atop US...
Hugh Chasmar, "Mutual Fund 'Switch Funds'", Taxation of Corporate Reorganizations, Canadian Tax Journal, Vol. 46, No. 1, 1998, p. 172 at 190
"Many fund managers, however, do not allocate foreign source income and foreign taxes to investors in a trust. The marginal tax benefit to most...
Subsection 104(22.1) - Foreign tax deemed paid by beneficiary
Administrative Policy
IT-201R2 "Foreign Tax Credit — Trust and Beneficiaries" 12 February 1996
- When, as a result of a designation [under s. 104(22)], a portion of the income of a trust from a foreign source is deemed to be income of a...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(22) | 209 |
Subsection 104(23) - Testamentary trusts
Administrative Policy
2 October 1996 Memorandum 962292
Although, where a taxpayer is a beneficiary under more than one testamentary trust, she may elect under s. 104(23)(d) separately in respect of...
Paragraph 104(23)(a)
Administrative Policy
7 September 1994 Memorandum 940625 (C.T.O. "First and Last Taxation Year of a Testamentary Trust")
"The final taxation year of a testamentary trust winding-up will end on the date of final distribution of its assets and not at its normal...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Fiscal Period | 20 |
Subsection 104(24) - Amount payable
See Also
Hall v. The Queen, 2003 DTC 779, 2003 TCC 410 (Informal Procedure)
Interest income of an estate in respect of which the executor, a trust company, issued T5 slips to the taxpayer beneficiaries was not payable to...
Degrace Family Trust v. The Queen, 99 DTC 453 (TCC)
In finding that trust property spent by Mrs. Degrace, the sole trustee of a family trust, on such matters as mortgage payments, decorating costs,...
Langer Family Trust v. MNR, 92 DTC 1055 (TCC)
Trustees of a family trust used amounts withdrawn from the bank account of the family corporation to pay various personal expenses (which in three...
Ginsburg v. MNR, 92 DTC 1774 (TCC)
In finding that income of a spousal trust was income of the spouse notwithstanding that, well after the taxation years in question, she purported...
Grayson v. MNR, 90 DTC 1108 (TCC)
A deceased friend of the taxpayer had provided in his will for the devising of all his property to the taxpayer. Although the will did not specify...
Administrative Policy
25 July 2016 External T.I. 2016-0630781E5 - 104(13.3) and a CPP/QPP death benefit
Is the option to include a Canada Pension Plan (“CPP”) or Quebec Pension Plan (“QPP”) death benefit on a post-2015 T3 return will no...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(13.3) | CPP benefit generally no longer eligible under 104(13.1) | 162 |
29 November 2016 CTF Roundtable Q. 14, 2016-0669871C6 - Estate distribution
A simple Will typically directs the Executor to pay the debts and expenses of the deceased, makes specific bequests of property and finally...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(6) | income from an estate residue generally can be distributed on a deductible basis | 147 |
8 June 2016 External T.I. 2015-0604971E5 - Deemed capital gain of a trust
1) Where the power to encroach on capital is general and the trustees exercise their discretion to encroach before the end of the trust’s year...
27 April 2016 External T.I. 2016-0625001E5 F - Surplus Stripping
An individual (Mr. X), and a corporation (Holdco) wholly owned by him are the beneficiaries of a Quebec discretionary trust (Trust) holding all...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 84 - Subsection 84(2) | using a trust to funnel a deemed dividend from creating PUC to a Holdco beneficiary and funnelling that PUC to the individual beneficiary, is surplus stripping | 220 |
| Tax Topics - Income Tax Act - Section 245 - Subsection 245(4) | funnelling deemed dividend to holdco trust beneficiary and resulting PUC to individual beneficiary/shareholder was surplus stripping | 130 |
10 June 2016 STEP Roundtable Q. 12, 2016-0634921C6 - Phantom Income
A trust realizes “phantom income,” for example, a deemed capital gain under a s. 48.1 when its shares of a CCPC become publicly listed. How...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(6) | payment in kind of distribution of phantom income | 78 |
9 October 2015 APFF Financial Strategies and Financial Instruments Roundtable Q. 6, 2015-0595851C6 F - Income of a trust payable to a beneficiary
Where a trust distributes all of its share of the accounting profits of a partnership but its share of the taxable income of the partnership is...
10 July 2013 Internal T.I. 2013-0475501I7 F - Amounts returned to trustee/beneficiary
Father and Y were the trustees of a Quebec family trust, whose beneficiaries included father and his three children. Distributions made by the...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(13) | distributions to children immediately paid to father | 174 |
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(6) | distributions to children immediately paid to father | 172 |
| Tax Topics - Income Tax Act - 101-110 - Section 105 - Subsection 105(1) | distributions to children immediately paid to father | 146 |
| Tax Topics - Income Tax Act - Section 56 - Subsection 56(2) | distributions to children immediately paid to father | 114 |
30 October 2012 Ontario CTF Roundtable, 2012-0462931C6 - CTF Ontario Conference- Trust payment to Minor
In response to a query as to whether the requirement, for "proper notice" being given to a beneficiary as to a demand promissory note being given...
4 March 2013 External T.I. 2011-0428661E5 - trust payments to minor
The trustees of a civil law trust exercise their discretionary power in order to allocate an amount of income or taxable capital gain to a minor...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 75 - Subsection 75(2) | 142 |
28 May 2012 CTF Prairie Trust Roundtable, 2012-0444891C6 - CTF Prairie Conference- Trust payment to Minor
CRA confirmed that "proper notice" of payment to a minor beneficiary by way of issuance of a promissory note can be given to the beneficiary's...
8 June 2010 2010 STEP Roundtable Q. 2, 2010-0363071C6 - STEP Roundtable Q2
For an amount to be "payable" to a beneficiary in a trust's taxation year, the beneficiary must have an enforceable right to payment by the end of...
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - General Concepts - Effective Date | 153 |
6 March 2001 External T.I. 2000-006082
"While most mutual fund trusts calculate the amount of income for a year to be distributed to the unitholders after the year-end, the trust...
Income Tax Technical News, No. 11, September 30, 1997, Payments Made by a Trust for the Benefit of a Minor Beneficiary".
26 August 1997 T.I. 972246
Discussion of the circumstances in which a payment made by a discretionary trust to third parties for the benefit of minor beneficiaries will be...
6 March 1997 Memorandum 960622 (see also 26 February 1997 Memorandum 952964)
Legal entitlement of a beneficiary to enforce payment to her of income of the trust is established by (a) the trustees irrevocably exercising...
1 August 1996 T.I. 960455 (C.T.O. "Amount Payable Subsection 104(24)")
The fact that the amount of income of an inter vivos family trust cannot be known at year-end because the only source of income of the trust is a...
13 June 1995 Memorandum 951422 (C.T.O. "Payment into Court by an Estate for Desceased's Children")
Where pension income receivable by an estate is paid pursuant to a court order into the court for the benefit of the deceased's minor children,...
June 1995 Memorandum 950867 (C.T.O. "Lifetime Capital Gains Exemption & Personal Trust")
Because it is not possible for a deemed capital gain (in this instance, arising under s. 110.6(19)) to be income (or a capital gain) for trust...
81 C.R. - Q.55
Where a particular beneficiary's entitlement to or share of the income of a trust is before the courts, the amount cannot be considered to be...
IT-286R2 "Trusts - Amount Payable"
Articles
Jack Bernstein, "Recent Tax Issues Affecting Family Trusts", Tax Profile, Vol. 5, No. 21, May 1998, p. 247.
Jack Bernstein, "Benefitting Beneficiaries", CA Magazine, March 1996, p. 24.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(18) | 0 |
Gabrielle Richards, "Executor's Year", Canadian Current Tax, October 1987, p. J49
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - 101-110 - Section 104 - Subsection 104(6) | 0 |