I-3 - Taxation Act

Section 453 Disposition versions

2010-04-20

453. If a right to receive an amount is transferred or distributed as a consequence of the death of a taxpayer to a beneficiary who is the taxpayer’s spouse resident in Canada immediately before the death or a trust referred to in section 440, and the beneficiary and the legal representative of the taxpayer make a valid election under subsection 2 of section 72 of the Income Tax Act (R.S.C. 1985, c. 1 (5th Suppl.)) after 19 December 2006 in respect of that right, the following rules apply if the taxpayer was resident in Canada immediately before dying:

(a)  sections 153 and 208 and sections 357 and 358, as they read in respect of the disposition of property, apply in computing the taxpayer’s income for the taxation year of the taxpayer’s death, subparagraph b of the first paragraph of section 234 applies in computing the taxpayer’s gain for that year and section 452 does not apply for the purpose of computing the taxpayer’s gain referred to in subparagraph a of the first paragraph of section 279 for that year, and the beneficiary must include in computing the beneficiary’s income or gain for the beneficiary’s first taxation year ending after the death the amounts deducted in respect of the taxpayer under sections 153 and 208, subparagraph b of the first paragraph of section 234, subparagraph a of the first paragraph of section 279 or sections 357 and 358;

(b)  the amounts provided for in subparagraph a are deemed to have been included in computing the income or earnings of the beneficiary for a previous year, from a similar source;

(c)  despite paragraphs a and b, if the taxpayer had disposed of a property, the beneficiary is deemed, for the purpose of computing any reserve the beneficiary may deduct, in respect of the disposition of property, under section 153, subparagraph b of the first paragraph of section 234, subparagraph a of the first paragraph of section 279 or either of sections 357 and 358, as they read in respect of that disposition, in computing the beneficiary’s income for a taxation year ending after the death of the taxpayer, to be the taxpayer who had disposed of the property and to have disposed of it at the time it was disposed of by the taxpayer.

Chapter V.2 of Title II of Book I applies in relation to an election made under subsection 2 of section 72 of the Income Tax Act or in relation to an election made under this section before 20 December 2006.

1972, c. 23, s. 369; 1973, c. 17, s. 50; 1975, c. 22, s. 102; 1984, c. 15, s. 101; 1987, c. 67, s. 109; 1990, c. 59, s. 172; 1993, c. 16, s. 188; 1994, c. 22, s. 180; 1997, c. 14, s. 77; 2009, c. 5, s. 153; 2010, c. 5, s. 45.

2009-05-15

453. If a right to receive an amount is transferred or distributed as a consequence of the death of a taxpayer to a beneficiary who is the taxpayer’s spouse resident in Canada immediately before the death or a trust referred to in section 440, and the beneficiary and the legal representative of the taxpayer make a valid election under subsection 2 of section 72 of the Income Tax Act (R.S.C. 1985, c. 1 (5th Suppl.)) after 19 December 2006 in respect of that right, the following rules apply if the taxpayer was resident in Canada immediately before dying:

(a)  sections 153 and 208 and sections 357 and 358, as they read in respect of the disposition of property, apply in computing the taxpayer’s income for the taxation year of the taxpayer’s death, subparagraph b of the first paragraph of section 234 applies in computing the taxpayer’s gain for that year and section 452 does not apply for the purpose of computing the taxpayer’s gain referred to in subparagraph a of the first paragraph of section 279 for that year, and the beneficiary must include in computing the beneficiary’s income or gain for the beneficiary’s first taxation year ending after the death the amounts deducted in respect of the taxpayer under sections 153 and 208, subparagraph b of the first paragraph of section 234, subparagraph a of the first paragraph of section 279 or sections 357 and 358;

(b)  the amounts provided for in subparagraph a are deemed to have been included in computing the income or earnings of the beneficiary for a previous year, from a similar source;

(c)  despite paragraphs a and b, if the taxpayer had disposed of a property, the beneficiary is deemed, for the purpose of computing any reserve the beneficiary may claim as a deduction, in respect of the disposition of property, under section 153, subparagraph b of the first paragraph of section 234, subparagraph a of the first paragraph of section 279 or either of sections 357 and 358, as they read in respect of that disposition, in computing the beneficiary’s income for a taxation year ending after the death of the taxpayer, to be the taxpayer who had disposed of the property and to have disposed of it at the time it was disposed of by the taxpayer.

Chapter V.2 of Title II of Book I applies in relation to an election made under subsection 2 of section 72 of the Income Tax Act or in relation to an election made under this section before 20 December 2006.

1972, c. 23, s. 369; 1973, c. 17, s. 50; 1975, c. 22, s. 102; 1984, c. 15, s. 101; 1987, c. 67, s. 109; 1990, c. 59, s. 172; 1993, c. 16, s. 188; 1994, c. 22, s. 180; 1997, c. 14, s. 77; 2009, c. 5, s. 153.

2006-03-01

453. Where a right to receive an amount is transferred or assigned as a consequence of the death of a taxpayer to a beneficiary who is his spouse resident in Canada immediately before the death or a trust referred to in section 440 and the beneficiary and legal representative of the taxpayer exercise jointly an election in respect of such right in prescribed form, the following rules apply if the taxpayer was resident in Canada immediately before his death:

(a)  sections 153, 208, 357 and 358 apply in computing the taxpayer’s income for the taxation year of his death, subparagraph b of the first paragraph of section 234 applies in computing his gain for that year and section 452 does not apply for the purpose of computing his gain referred to in paragraph a of section 279 for that year, and the beneficiary must include in computing his income or gain, as the case may be, for his first taxation year ending after the death the amounts deducted in respect of the taxpayer under sections 153 and 208, subparagraph b of the first paragraph of section 234, paragraph a of section 279 or sections 357 and 358;

(b)  the amounts provided for in paragraph a are deemed to have been included in computing the income or earnings of the beneficiary for a previous year, from a similar source;

(c)  notwithstanding paragraphs a and b, where the taxpayer had disposed of property, the beneficiary is deemed, for the purposes of computing any amount he may claim as a reserve under section 153, subparagraph b of the first paragraph of section 234, paragraph a of section 279 or sections 357 and 358, in respect of the disposition of the property, in computing his income for a taxation year ending after the death of the taxpayer, to be the taxpayer who had disposed of the property and to have disposed of it at the time it was disposed of by the taxpayer.

1972, c. 23, s. 369; 1973, c. 17, s. 50; 1975, c. 22, s. 102; 1984, c. 15, s. 101; 1987, c. 67, s. 109; 1990, c. 59, s. 172; 1993, c. 16, s. 188; 1994, c. 22, s. 180; 1997, c. 14, s. 77.