I-3 - Taxation Act

Section 716 Disposition versions

2012-05-09

716. The rule set out in the second paragraph applies if, at any time, a corporation makes a gift of a capital property to a qualified donee or, if the corporation is not resident in Canada, a gift of an immovable property situated in Canada to a prescribed donee who provides an undertaking, in a form satisfactory to the Minister, to the effect that the property will be held for use in the public interest, the corporation designates, after 19 December 2006 and in accordance with subsection 3 of section 110.1 of the Income Tax Act (R.S.C. 1985, c. 1 (5th Suppl.)), an amount in respect of the gift, and, at that time, the fair market value of the capital property or immovable property exceeds

(a)  in the case of a depreciable property of a prescribed class, the lesser of the undepreciated capital cost of that class at the end of the taxation year of the corporation that includes that time, determined without reference to the proceeds of disposition determined in respect of the property under the second paragraph, and the adjusted cost base to the corporation of the property immediately before that time; and

(b)  in any other case, the adjusted cost base to the corporation of the capital property or immovable property immediately before that time.

The lesser of the fair market value of the capital property or immovable property otherwise determined and the greatest of the following amounts, is deemed to be both the corporation’s proceeds of disposition of the capital property or immovable property and, for the purposes of section 7.21, the fair market value of the gift:

(a)  in the case of a gift made after 20 December 2002, the amount of the advantage in respect of the gift;

(b)  the amount determined under subparagraph a or b of the first paragraph in respect of the capital property or immovable property; and

(c)  the amount designated in respect of the gift in accordance with subsection 3 of section 110.1 of the Income Tax Act.

Chapter V.2 of Title II of Book I applies in relation to a designation made under subsection 3 of section 110.1 of the Income Tax Act or in relation to a designation made under this section before 20 December 2006.

1973, c. 17, s. 84; 1986, c. 15, s. 104; 1987, c. 67, s. 137; 1993, c. 64, s. 50; 1994, c. 22, s. 246; 1995, c. 1, s. 53; 1997, c. 3, s. 71; 1999, c. 83, s. 70; 2003, c. 2, s. 193; 2009, c. 5, s. 240; 2012, c. 8, s. 64.

2009-05-15

716. The rule set out in the second paragraph applies if, at any time, a corporation makes a gift of a capital property to a donee referred to in any of paragraphs a to c of section 710 or, if the corporation is not resident in Canada, a gift of an immovable property situated in Canada to a prescribed donee who provides an undertaking, in a form satisfactory to the Minister, to the effect that the property will be held for use in the public interest, the corporation designates, after 19 December 2006 and in accordance with subsection 3 of section 110.1 of the Income Tax Act (R.S.C. 1985, c. 1 (5th Suppl.)), an amount in respect of the gift, and, at that time, the fair market value of the capital property or immovable property exceeds

(a)  in the case of a depreciable property of a prescribed class, the lesser of the undepreciated capital cost of that class at the end of the taxation year of the corporation that includes that time, determined without reference to the proceeds of disposition determined in respect of the property under the second paragraph, and the adjusted cost base to the corporation of the property immediately before that time; and

(b)  in any other case, the adjusted cost base to the corporation of the capital property or immovable property immediately before that time.

The lesser of the fair market value of the capital property or immovable property otherwise determined and the greatest of the following amounts, is deemed to be both the corporation’s proceeds of disposition of the capital property or immovable property and, for the purposes of section 7.21, the fair market value of the gift:

(a)  in the case of a gift made after 20 December 2002, the amount of the advantage in respect of the gift;

(b)  the amount determined under subparagraph a or b of the first paragraph in respect of the capital property or immovable property; and

(c)  the amount designated in respect of the gift in accordance with subsection 3 of section 110.1 of the Income Tax Act.

Chapter V.2 of Title II of Book I applies in relation to a designation made under subsection 3 of section 110.1 of the Income Tax Act or in relation to a designation made under this section before 20 December 2006.

1973, c. 17, s. 84; 1986, c. 15, s. 104; 1987, c. 67, s. 137; 1993, c. 64, s. 50; 1994, c. 22, s. 246; 1995, c. 1, s. 53; 1997, c. 3, s. 71; 1999, c. 83, s. 70; 2003, c. 2, s. 193; 2009, c. 5, s. 240.

2006-03-01

716. Where, at any time, a corporation makes a gift of capital property to a donee referred to in any of paragraphs a to c of section 710 or, if the corporation is not resident in Canada, a gift of immovable property situated in Canada to a prescribed donee who provides an undertaking, in a form satisfactory to the Minister, to the effect that such property will be held for use in the public interest, and the fair market value of the capital property or immovable property, as the case may be, exceeds its adjusted cost base to the corporation at that time, the corporation may designate in the fiscal return it is required to file under section 1000 for the year in which the gift is made, an amount which is deemed to be both the corporation’s proceeds of disposition of the capital property or immovable property, as the case may be, and, for the purposes of section 710, the fair market value of the gift, and which, at that time, must not be greater than the fair market value otherwise determined nor less than the adjusted cost base to the corporation of the capital property or immovable property, as the case may be.

1973, c. 17, s. 84; 1986, c. 15, s. 104; 1987, c. 67, s. 137; 1993, c. 64, s. 50; 1994, c. 22, s. 246; 1995, c. 1, s. 53; 1997, c. 3, s. 71; 1999, c. 83, s. 70; 2003, c. 2, s. 193.