If a non-resident trust is "tainted" as a resident trust under s. 94(2)(g) by being issued shares by a resident corporation, it potentially can re-acquire non-residency status under s. 94(2)(t) if it makes a qualifying sale of the shares. In the example, this occurs on August 15, 2011. It thereupon changes its status immediately, so that it is non-resident for the stub period beginning on August 16, 2011, is resident for the stub period ending on August 15, 2011, and has a potential deemed disposition of its property under the emigration rule (s. 128.1(4)) as a result of the status change. CRA stated:
[P]aragraph 94(2)(t) … applies to expunge the contribution after the time of the sale (i.e., from the time of the sale forward, the contribution is considered to have never occurred). As such, at the end of the 2011 taxation year (i.e., December 31, 2011) of Trust A, paragraph 94(3)(a) would not apply as there is no resident contributor. Conversely, subsection 94(5) would apply since the conditions therein are met, including that at the end of the 2011 taxation year, there is no resident contributor.