1 November 2016 Internal T.I. 2016-0663971I7 - 104(6)(b), whether amount became payable -- summary under Subsection 104(6)

A family trust paid income to the minor children in breach of a prohibition in the trust deed against making distributions to designated beneficiaries. CRA considered, notwithstanding s. 104(24), that if the amount cannot be legally payable, actually paying it will not bring it within the s. 104(6) rule. Accordingly, there was no s. 104(6) deduction to the trust, and CRA considered the distributions to be includible in the children’s income under s. 105(1) rather than s. 104(13).