VIII, s. 42, c. 8, s. 12, c. 21, s. 461995, c. 3, s. 281996, c. 21, s. 181998, c. 19, s. 1272000, c. 12, s. 1422001, c. 17, s. 782003, c. 15, s. 72, c. 28, s. 112005, c. 19, s. 172007, c. 2, s. 15, c. 29, s. 8, c. 35, s. 272010, c. 25, s. 162013, c. 34, ss. 10, 2312014, c. 39, s. 262015, c. 36, s. 52016, c. 12, s. 352017, c. 33, s. 352018, c. 12, s. 8
105(1)The value of all benefits to a taxpayer during a taxation year from or under a trust, irrespective of when created, shall, subject to subsection 105(2), be included in computing the taxpayer’s income for the year except to the extent that the value(a)is otherwise required to be included in computing the taxpayer’s income for a taxation year; or(b)has been deducted under paragraph 53(2)(h) in computing the adjusted cost base of the taxpayer’s interest in the trust or would be so deducted if that paragraph(i)applied in respect of the taxpayer’s interest in the trust, and(ii)were read without reference to clause 53(2)(h)(i.1)(B).Marginal note:Upkeep, etc.(2)Such part of an amount paid by a trust out of income of the trust for the upkeep, maintenance or taxes of or in respect of property that, under the terms of the trust arrangement, is required to be maintained for the use of a tenant for life or a beneficiary as is reasonable in the circumstances shall be included in computing the income of the tenant for life or other beneficiary from the trust for the taxation year for which it was paid.
(a)is otherwise required to be included in computing the taxpayer’s income for a taxation year; or(b)has been deducted under paragraph 53(2)(h) in computing the adjusted cost base of the taxpayer’s interest in the trust or would be so deducted if that paragraph(i)applied in respect of the taxpayer’s interest in the trust, and(ii)were read without reference to clause 53(2)(h)(i.1)(B).
(i)applied in respect of the taxpayer’s interest in the trust, and(ii)were read without reference to clause 53(2)(h)(i.1)(B).
[NOTE: Application provisions are not included in the consolidated textsee relevant amending Acts and regulations.]1970-71-72, c. 63, s. 1“105”1988, c. 55, s. 72
106(1)Where an amount in respect of a taxpayer’s income interest in a trust has been included in computing the taxpayer’s income for a taxation year by reason of subsection 106(2) or 104(13), except to the extent that an amount in respect of that income interest has been deducted in computing the taxpayer’s taxable income pursuant to subsection 112(1) or 138(6), there may be deducted in computing the taxpayer’s income for the year the lesser of(a)the amount so included in computing the taxpayer’s income for the year, and(b)the amount, if any, by which the cost to the taxpayer of the income interest exceeds the total of all amounts in respect of the interest that were deductible under this subsection in computing the taxpayer’s income for previous taxation years.Marginal note:Cost of income interest in a trust(1.1)The cost to a taxpayer of an income interest of the taxpayer in a trust is deemed to be nil unless(a)any part of the interest was acquired by the taxpayer from a person who was the beneficiary in respect of the interest immediately before that acquisition; or(b)the cost of any part of the interest would otherwise be determined not to be nil under paragraph 128.1(1)(c) or (4)(c).Marginal note:Disposition by taxpayer of income interest(2)Where in a taxation year a taxpayer disposes of an income interest in a trust,(a)except where subsection (3) applies to the disposition, there shall be included in computing the taxpayer’s income for the year the amount, if any, by which(i)the proceeds of dispositionexceed(ii)where that interest includes a right to enforce payment of an amount by the trust, the amount in respect of that right that has been included in computing the taxpayer’s income for a taxation year because of subsection 104(13);(b)any taxable capital gain or allowable capital loss of the taxpayer from the disposition shall be deemed to be nil; and(c)for greater certainty, the cost to the taxpayer of each property received by the taxpayer as consideration for the disposition is the fair market value of the property at the time of the disposition.Marginal note:Proceeds of disposition of income interest(3)For greater certainty, where at any time any property of a trust has been distributed by the trust to a taxpayer who was a beneficiary under the trust in satisfaction of all or any part of the taxpayer’s income interest in the trust, the trust shall be deemed to have disposed of the property for proceeds of disposition equal to the fair market value of the property at that time.
(a)the amount so included in computing the taxpayer’s income for the year, and(b)the amount, if any, by which the cost to the taxpayer of the income interest exceeds the total of all amounts in respect of the interest that were deductible under this subsection in computing the taxpayer’s income for previous taxation years.
(a)any part of the interest was acquired by the taxpayer from a person who was the beneficiary in respect of the interest immediately before that acquisition; or(b)the cost of any part of the interest would otherwise be determined not to be nil under paragraph 128.1(1)(c) or (4)(c).
(a)except where subsection (3) applies to the disposition, there shall be included in computing the taxpayer’s income for the year the amount, if any, by which(i)the proceeds of dispositionexceed(ii)where that interest includes a right to enforce payment of an amount by the trust, the amount in respect of that right that has been included in computing the taxpayer’s income for a taxation year because of subsection 104(13);(b)any taxable capital gain or allowable capital loss of the taxpayer from the disposition shall be deemed to be nil; and(c)for greater certainty, the cost to the taxpayer of each property received by the taxpayer as consideration for the disposition is the fair market value of the property at the time of the disposition.
(i)the proceeds of disposition
(ii)where that interest includes a right to enforce payment of an amount by the trust, the amount in respect of that right that has been included in computing the taxpayer’s income for a taxation year because of subsection 104(13);
[NOTE: Application provisions are not included in the consolidated textsee relevant amending Acts and regulations.]R.S., 1985, c. 1 (5th Supp.), s. 1062001, c. 17, s. 792013, c. 34, s. 232(F)
107(1)Where a taxpayer has disposed of all or any part of the taxpayer’s capital interest in a trust,(a)where the trust is a personal trust or a prescribed trust, for the purpose of computing the taxpayer’s capital gain, if any, from the disposition, the adjusted cost base to the taxpayer of the interest or the part of the interest, as the case may be, immediately before the disposition is, unless any part of the interest has ever been acquired for consideration and, at the time of the disposition, the trust is non-resident, deemed to be the greater of(i)its adjusted cost base, otherwise determined, to the taxpayer immediately before the disposition, and(ii)the amount, if any, by which(A)its cost amount to the taxpayer immediately before the dispositionexceeds(B)the total of all amounts deducted under paragraph 53(2)(g.1) in computing its adjusted cost base to the taxpayer immediately before the disposition;(b)[Repealed, 2001, c. 17, s. 80](c)where the taxpayer is not a mutual fund trust, the taxpayer’s loss from the disposition is deemed to be the amount, if any, by which the amount of that loss otherwise determined exceeds the amount, if any, by which(i)the total of all amounts each of which was received or would, but for subsection 104(19), have been received by the trust on a share of the capital stock of a corporation before the disposition (and, where the trust is a unit trust, after 1987) and(A)where the taxpayer is a corporation,(I)was a taxable dividend designated under subsection 104(19) by the trust in respect of the taxpayer, to the extent of the amount of the dividend that was deductible under section 112 or subsection 115(1) or 138(6) in computing the taxpayer’s taxable income or taxable income earned in Canada for any taxation year, or(II)was an amount designated under subsection 104(20) by the trust in respect of the taxpayer,(B)where the taxpayer is another trust, was an amount designated under subsection 104(19) or 104(20) by the trust in respect of the taxpayer, and(C)where the taxpayer is not a corporation, trust or partnership, was an amount designated under subsection 104(20) by the trust in respect of the taxpayerexceeds(ii)the portion of the total determined under subparagraph 107(1)(c)(i) that can reasonably be considered to have resulted in a reduction, under this paragraph, of the taxpayer’s loss otherwise determined from a previous disposition of an interest in the trust;(d)where the taxpayer is a partnership, the share of a person (other than another partnership or a mutual fund trust) of any loss of the partnership from the disposition is deemed to be the amount, if any, by which that loss otherwise determined exceeds the amount, if any, by which(i)the total of all amounts each of which is a dividend that was received or would, but for subsection 104(19), have been received by the trust on a share of the capital stock of a corporation before the disposition (and, where the trust is a unit trust, after 1987) and(A)where the person is a corporation,(I)was a taxable dividend that was designated under subsection 104(19) by the trust in respect of the taxpayer, to the extent of the amount of the dividend that was deductible under section 112 or subsection 115(1) or 138(6) in computing the person’s taxable income or taxable income earned in Canada for any taxation year, or(II)was a dividend designated under subsection 104(20) by the trust in respect of the taxpayer and was an amount received by the person,(B)where the person is an individual other than a trust, was a dividend designated under subsection 104(20) by the trust in respect of the taxpayer and was an amount received by the person, and(C)where the person is another trust, was a dividend designated under subsection 104(19) or 104(20) by the trust in respect of the taxpayer and was an amount received by the person (or that would have been received by the person if this Act were read without reference to subsection 104(19)),exceeds(ii)the portion of the total determined under subparagraph 107(1)(d)(i) that can reasonably be considered to have resulted in a reduction, under this paragraph, of the person’s loss otherwise determined from a previous disposition of an interest in the trust; and(e)if the capital interest is not a capital property of the taxpayer, notwithstanding the definitioncost amountin subsection 108(1), its cost amount is deemed to be the amount, if any, by which(i)the amount that would, if this Act were read without reference to this paragraph and the definitioncost amountin subsection 108(1), be its cost amountexceeds(ii)the total of all amounts, each of which is an amount in respect of the capital interest that has become payable to the taxpayer before the disposition and that would be described in subparagraph 53(2)(h)(i.1) if that subparagraph were read without reference to its subclause (B)(I).Marginal note:Cost of capital interest in a trust(1.1)The cost to a taxpayer of a capital interest of the taxpayer in a personal trust or a prescribed trust is deemed to be,(a)where the taxpayer elected under subsection 110.6(19) in respect of the interest and the trust does not elect under that subsection in respect of any property of the trust, the taxpayer’s cost of the interest determined under paragraph 110.6(19)(a); and(b)in any other case, nil, unless(i)any part of the interest was acquired by the taxpayer from a person who was the beneficiary in respect of the interest immediately before that acquisition, or(ii)the cost of any part of the interest would otherwise be determined not to be nil under section 48 as it read in its application before 1993 or under paragraph 111(4)(e) or 128.1(1)(c) or (4)(c).Marginal note:Deemed fair market value — non-capital property(1.2)For the purpose of section 10, the fair market value at any time of a capital interest in a trust is deemed to be equal to the amount that is the total of(a)the amount that would, if this Act were read without reference to this subsection, be its fair market value at that time, and(b)the total of all amounts, each of which is an amount that would be described, in respect of the capital interest, in subparagraph 53(2)(h)(i.1) if that subparagraph were read without reference to its subclause (B)(I), that has become payable to the taxpayer before that time.Marginal note:Distribution by personal trust(2)Subject to subsections (2.001), (2.002) and (4) to (5), if at any time a property of a personal trust or a prescribed trust is distributed (otherwise than as a SIFT trust wind-up event) by the trust to a taxpayer who was a beneficiary under the trust and there is a resulting disposition of all or any part of the taxpayer’s capital interest in the trust,(a)the trust shall be deemed to have disposed of the property for proceeds of disposition equal to its cost amount to the trust immediately before that time;(b)subject to subsection (2.2), the taxpayer is deemed to have acquired the property at a cost equal to the total of its cost amount to the trust immediately before that time and the specified percentage of the amount, if any, by which(i)the adjusted cost base to the taxpayer of the capital interest or part of it, as the case may be, immediately before that time (determined without reference to paragraph (1)(a))exceeds(ii)the cost amount to the taxpayer of the capital interest or part of it, as the case may be, immediately before that time;(b.1)for the purpose of paragraph (b), the specified percentage is,(i)where the property is capital property (other than depreciable property), 100%, and(ii)[Repealed, 2016, c. 12, s. 36](iii)in any other case, 50%;(c)the taxpayer’s proceeds of disposition of the capital interest in the trust (or of the part of it) disposed of by the taxpayer on the distribution are deemed to be equal to the amount, if any, by which(i)the cost at which the taxpayer would be deemed by paragraph (b) to have acquired the property if the specified percentage referred to in that paragraph were 100%exceeds(ii)the total of all amounts each of which is an eligible offset at that time of the taxpayer in respect of the capital interest or the part of it;(d)where the property so distributed was depreciable property of a prescribed class of the trust and the amount that was the capital cost to the trust of that property exceeds the cost at which the taxpayer is deemed by this section to have acquired the property, for the purposes of sections 13 and 20 and any regulations made under paragraph 20(1)(a)(i)the capital cost to the taxpayer of the property shall be deemed to be the amount that was the capital cost of the property to the trust, and(ii)the excess shall be deemed to have been allowed to the taxpayer in respect of the property under regulations made under paragraph 20(1)(a) in computing income for taxation years before the acquisition by the taxpayer of the property.(d.1)[Repealed, 2010, c. 12, s. 10](e)[Repealed, 1994, c. 7, Sch