I-3 - Taxation Act

Section 1102 Disposition versions

2009-06-04

1102. Where a person not resident in Canada disposes or proposes to dispose of a property, other than excluded property, that is a life insurance policy described in subparagraph k of the first paragraph of section 1089, a Québec resource property within the meaning of subparagraph d of the first paragraph of section 1089 or a taxable Québec property, to a person with whom the person not resident in Canada was not dealing at arm’s length, for no consideration or for consideration less than the fair market value at the time the person not resident in Canada so disposes of it or proposes to dispose of it, as the case may be, or to any person by way of gift inter vivos, the following rules apply:

(a)  subparagraph c of the first paragraph of section 1097 must be read as a reference to “the amount he considers to be the fair market value of the property at the time he proposes to dispose of it”;

(b)  the reference in section 1098 to the amount which such person proposes to receive from the disposition must be read as a reference to the amount that such person considers to be the fair market value of the property;

(c)  the references in sections 1099 and 1100 to the proceeds or actual proceeds of disposition of the property must be read as references to the fair market value of the property immediately before it was disposed of; and

(d)  the references in sections 1101 and 1102.2 to the purchase price of the property must be read as references to its fair market value at the time it was acquired.

The first paragraph does not apply when, by reason of the death of a person, a property is transferred or distributed on or after his death.

1975, c. 22, s. 249; 1982, c. 5, s. 200; 1984, c. 15, s. 242; 1986, c. 15, s. 197; 1986, c. 19, s. 202; 2001, c. 7, s. 158; 2004, c. 8, s. 193; 2009, c. 15, s. 371.

2006-03-01

1102. Where a person not resident in Canada disposes or proposes to dispose of a property, other than excluded property, that is a life insurance policy described in subparagraph k of the first paragraph of section 1089, a Québec resource property within the meaning of subparagraph d of the first paragraph of section 1089 or a taxable Québec property, to a person with whom the person not resident in Canada was not dealing at arm’s length, for no consideration or for consideration less than the fair market value at the time the person not resident in Canada so disposes of it or proposes to dispose of it, as the case may be, or to any person by way of gift inter vivos, the following rules apply:

(a)  subparagraph c of the first paragraph of section 1097 must be read as a reference to “the amount he considers to be the fair market value of the property at the time he proposes to dispose of it”;

(b)  the reference in section 1098 to the amount which such person proposes to receive from the disposition must be read as a reference to the amount that such person considers to be the fair market value of the property;

(c)  the references in sections 1099 and 1100 to the proceeds or actual proceeds of disposition of the property must be read as references to the fair market value of the property immediately before it was disposed of; and

(d)  the references in sections 1101 and 1102.2 to the purchase price of the property must be read as references to its fair market value at the time it was acquired.

This section does not apply when, by reason of the death of a person, a property is transferred or distributed on or after his death.

1975, c. 22, s. 249; 1982, c. 5, s. 200; 1984, c. 15, s. 242; 1986, c. 15, s. 197; 1986, c. 19, s. 202; 2001, c. 7, s. 158; 2004, c. 8, s. 193.