The Directorate indicated that shares for purposes of s. 136(2)(d) would include shares that had been subscribed for by the member but not fully paid for, noting that “the QCA does not require payment of the shares at the time of subscription.”
As the result of the winding up of a partnership that held shares of a small business corporation, one of the former partners has held undivided rights to the shares of the corporation for more than 24 months. Would the disposition of the undivided interest in the shares held by this shareholder qualify for the capital gains deduction pursuant to subsection 110.6(2).
Before concluding that “for the purposes of the Act, a cooperative is a corporation, a share of the capital stock of a cooperative is a share and a member can be a shareholder,” CRA stated:
Canadian Parent holds mandatorily redeemable preferred shares (“MRPS”), as well as ordinary common shares in private limited liability companies, (“Holdings” and “Finance”), and is their sole shareholder. The articles of incorporation of Holdings specify a “nominal” euro value for each MRPS and that Holdings must maintain a share premium account and a reserve account for the MRPS.
