CRA indicated that it considers there to be a single property for s. 248(21) purposes if separate lots (e.g., two lots separated by Crown ownership of a stream or by another taxpayer's property) had been acquired under a single deed. CRA stated:
Subsection 248(21) applies where a co-owner receives, upon the partition of "a property", title to a separate piece of property whose fair market value equals the fair market value of the co-owner's previous interest. In such a situation, paragraph 248(21)(b) of the Act deems the co-owner's new interest to be a continuation of the co-owner's undivided interest in the property immediately before the partition. In other words, the co-owner will have neither disposed of nor acquired any property and, as a result, there is no capital gain or loss upon the partition of the property. Since the term "a property" is used, this means a singular property or one property. However, paragraph 248(21)(c) provides an exception to the single property rule for purposes of subsection 248(21) and modifies the meaning of the term "a property" so that subdivisions of land established in the course of, or in contemplation of, a partition shall be regarded as one property.
…Where more than one property is acquired under one deed, it is our general view that such properties would be considered to be one property.