Non-resident individuals entrusted the custody of certain funds to the Quebec office of a Canadian financial institution, which held the funds in the form of corporate securities and precious metals certificates, which were entrusted to it for safekeeping purposes. Now 10 of those individuals have died, and their heirs are non-residents. Are such securities held on their behalf held under trusts and, if so, is the trusts’ residence in Canada?
CRA indicated that given that the Canadian financial institution performs only custodial and safekeeping functions, there is no trust. After quoting the definition of legal representative, it stated:
A review of the will or the legislation governing the deceased's property would make it possible to determine the name and residence of the legal representatives having control of the estate's property, who are generally the executors or liquidators. Paragraph 2 of Interpretation Bulletin IT-447 will make it possible to establish which among these, if there are several, is the person who is administering the estate or has control of the estate's property as well as the residence of the estate. For this purpose, the CRA will not take into account the depositary and custodial functions performed by a Canadian financial institution that would not otherwise be a legal representative with control of the estate's property.