Income Tax Act — I-3.3 188
Deemed year-end on notice of revocation 188 (1) If on a particular day the Minister issues a notice of intention to revoke the registration of a taxpayer as a registered charity under any of subsections 149.1(2) to (4.1) and 168(1), it becomes a listed terrorist entity or it is determined, under subsection 7(1) of the Charities Registration (Security Information) Act , that a certificate served in respect of the charity under subsection 5(1) of that Act is reasonable on the basis of information and evidence available, (a) the taxation year of the charity that would otherwise have included that day is deemed to end at the end of that day; (b) a new taxation year of the charity is deemed to begin immediately after that day; and (c) for the purpose of determining the charity’s fiscal period after that day, the charity is deemed not to have established a fiscal period before that day. Revocation tax (1.1) A charity referred to in subsection (1) is liable to a tax, for its taxation year that is deemed to have ended, equal to the amount determined by the formula A - B where A is the total of all amounts, each of which is (a) the fair market value of a property of the charity at the end of that taxation year, (b) the amount of an appropriation (within the meaning assigned by subsection (2)) in respect of a property transferred to another person in the 120-day period that ended at the end of that taxation year, or (c) the income of the charity for its winding-up period, including gifts received by the charity in that period from any source and any income that would be computed under section 3 as if that period were a taxation year; and B is the total of all amounts (other than the amount of an expenditure in respect of which a deduction has been made in computing income for the winding-up period under paragraph (c) of the description of A), each of which is (a) a debt of the charity that is outstanding at the end of that taxation year, (b) an expenditure made by the charity during the winding-up period on charitable activities carried on by it, or (c) an amount in respect of a property transferred by the charity during the winding-up period and not later than the latter of one year from the end of the taxation year and the day, if any, referred to in paragraph (1.2)(c), to a person that was at the time of the transfer an eligible donee in respect of the charity, equal to the amount, if any, by which the fair market value of the property, when transferred, exceeds the consideration given by the person for the transfer. Winding-up period (1.2) In this Part, the winding-up period of a charity is the period (a) that begins immediately after the earliest of the days on which (i) the Minister issues a notice of intention to revoke the registration of the charity under any of subsections 149.1(2) to (4.1) and 168(1), (ii) the charity becomes a listed terrorist entity, and (iii) it is determined, under subsection 7(1) of the Charities Registration (Security Information) Act , that a certificate served in respect of the charity under subsection 5(1) of that Act is reasonable on the basis of information and evidence available, and (b) that ends on the day that is the latest of (i) the day, if any, on which the charity files a return under subsection 189(6.1) for the taxation year deemed by subsection (1) to have ended, but not later than the day on which the charity is required to file that return, (ii) the day on which the Minister last issues a notice of assessment of tax payable under subsection (1.1) for that taxation year by the charity, and (iii) if the charity has filed a notice of objection or appeal in respect of that assessment, the day on which the Minister may take a collection action under section 225.1 in respect of that tax payable. Eligible donee (1.3) In this Part, an eligible donee in respect of a particular charity is (a) a registered charity (i) of which more than 50% of the members of the board of directors or trustees of t