Income Tax Act — I-3.3 248
irectly or indirectly in any manner whatever, for) property that is the subject of a gift or monetary contribution by the taxpayer to the recipient or any person dealing not at arm’s length with the recipient, the following rules apply: (a) for the purpose of subsection (31), the fair market value of the property that is the subject of the gift or monetary contribution made by the taxpayer is deemed to be that proportion of the lesser of the fair market value of the substantive gift and the cost, or if the substantive gift is capital property of the taxpayer, the adjusted cost base, of the substantive gift to the taxpayer immediately before the disposition to the recipient, that the fair market value otherwise determined of the property that is the subject of the gift or monetary contribution is of the proceeds of disposition of the substantive gift; and (b) if the substantive gift is capital property of the taxpayer, for the purpose of the definitions proceeds of disposition of property in subsection 13(21) and section 54, the sale price of the substantive gift is to be reduced by the amount by which the fair market value of the property that is the subject of the gift (determined without reference to this section) exceeds the fair market value determined under paragraph (a). (c) [Repealed, 2016, c. 12, s. 63] Inter-charity gifts (40) Subsection (30) does not apply in respect of a gift received by a qualified donee from a registered charity. Information not provided (41) Notwithstanding subsection (31), the eligible amount of a gift or monetary contribution made by a taxpayer is nil if the taxpayer does not — before a receipt referred to in subsection 110.1(2), 118.1(2) or 127(3), as the case may be, is issued in respect of the gift or monetary contribution — inform the qualified donee or the recipient, as the case may be, of any circumstances in respect of which subsection (31), (35), (36), (38) or (39) requires that the eligible amount of the gift or monetary contribution be less than the fair market value, determined without reference to subsections (35), 110.1(3) and 118.1(6), of the property that is the subject of the gift or monetary contribution. Synthetic equity arrangements — disaggregation (42) For the purposes of the definition synthetic equity arrangement in subsection (1), paragraph (c) of the definition dividend rental arrangement in subsection (1) and subsection 112(10), an arrangement that reflects the fair market value of more than one type of identical share (within the meaning of subsection 112(10)) is considered to be a separate arrangement with respect to each type of identical share the value of which the arrangement reflects. Substantive CCPC — anti-avoidance (43) For the purposes of this Act, if it is reasonable to consider that one of the purposes of any transaction (as defined in subsection 245(1)), or series of transactions, is to cause a corporation that is resident in Canada (other than a Canadian-controlled private corporation or a corporation that is, in absence of this subsection, a substantive CCPC) to avoid tax otherwise payable under section 123.3 on the corporation’s aggregate investment income, the corporation is deemed to be a substantive CCPC from the time that the transaction or series of transactions commenced until the earliest time at which the corporation (a) becomes a Canadian-controlled private corporation; (b) is subject to a loss restriction event; or (c) ceases to be resident in Canada. [NOTE: Application provisions are not included in the consolidated text; see relevant amending Acts and regulations.] R.S., 1985, c. 1 (5th Supp.), s. 248; 1994, c. 7, Sch. II, s. 192, Sch. V, s. 90, Sch. VIII, ss. 139, c. 8, s. 32, c. 21, ss. 109, 138, c. 41, s. 37; 1995, c. 3, s. 52, c. 21, ss. 43, 47, 59, 65, 74; 1996, c. 21, s. 60; 1997, c. 25, s. 71; 1998, c. 19, ss. 66, 239; 1999, c. 22, s. 80; 2000, c. 12, ss. 139, 142, c. 19, s. 67; 2001, c. 17, ss. 188, 230; 2002, c. 9, s. 44; 2003, c.