beneficiary

Pursuant to Reg. 204.2(1)(a), a trustee of a trust is required to report information about each “beneficiary” of the trust, unless the trust is subject to one of the exceptions in s. 150(1.2) or an exception in s. 204.2(2) applies. CRA was asked to comment on the meaning of “beneficiary” in the context of a query about a “disaster clause” for a family trust providing that in the event that none of the parents and their issue survived, the assets of the trust are to go to extended family members (“contingent beneficiaries”).

Having regard to the approaching 21-year anniversary, the trustees of a resident discretionary family trust of which only the children are beneficiaries decide to distribute the trust property to a newly created trust which has been settled for the benefit of the children. CRA found that the transfer of the trust property to the new trust would not occur on a s. 107(2) rollover basis.