Roy Shultis A. Seidel Director Financial Industries Division Publications 957-8960
0-903047
SUBJECT: Trust Companies - Interpretation Bulletin IT-466
IT-466 discusses the application of the Income Tax Act to certain transactions of trust companies as of December 29, 1980.
Subsequent to that date there have been considerable legislative changes which relate to items dealt with in IT-466 including the following:
1. Section 33 of the Income Tax Act (the "Act") has been repealed.
2. Paragraph 20(1)(l) of the Act has been amended.
3. Paragraph 20(1)(f) of the Act has been amended.
4. Paragraph 18(1)(s) of the Act has been enacted to prevent trust companies from claiming any loss, depreciation or reduction in the value or "amortized cost" of a loan or "lending asset". The terms "amortized cost" and "lending asset" are defined in subsection 248(1) of the Act.
5. There have been significant changes in the Loan Companies Act and the Trust Companies Act since 1980.
Apart from the pure technical changes required we also note that paragraphs 14 and 15 of IT-466 discuss the Department's position with respect to the tax treatment of gains and losses for transactions conducted in the "Company Account" and paragraph 4 of IT-466 discusses the Department's position with respect to gains and losses resulting from the disposition of securities acquired with funds of the "Guaranteed Funds Account".
21(1)(b)
21(1)(a)
for Director Financial Industries Division Rulings Directorate