Income Tax Act — I-3.3 110.6
ment of the payment of dividends and no failure to pay dividends in respect of the share; (b) there was no variation from year to year in the amount of dividends payable in respect of the share (other than where the amount of dividends payable is expressed as an invariant percentage of or by reference to an invariant difference between the dividend expressed as a rate of interest and a generally quoted market interest rate); and (c) the proceeds to be received by the investor on the disposition of the share are the same amount the corporation received as consideration on the issue of the share. Where deduction not permitted (11) Where it is reasonable to consider that one of the main reasons for an individual acquiring, holding or having an interest in a partnership or trust (other than an interest in a personal trust) or a share of an investment corporation, mortgage investment corporation or mutual fund corporation, or for the existence of any terms, conditions, rights or other attributes of the interest or share, is to enable the individual to receive or have allocated to the individual a percentage of any capital gain or taxable capital gain of the partnership, trust or corporation that is larger than the individual’s percentage of the income of the partnership, trust or corporation, as the case may be, notwithstanding any other provision of this Act, (a) no amount may be deducted under this section by the individual in respect of any such gain allocated or distributed to the individual after November 21, 1985; and (b) where the individual is a trust, any such gain allocated or distributed to it after November 21, 1985 shall not be included in computing its eligible taxable capital gain (within the meaning assigned by subsection 108(1)). (12) [Repealed, 2014, c. 39, s. 30] Determination under para. 3(b) (13) For the purposes of this section, the amount determined under paragraph 3(b) in respect of an individual for a period throughout which the individual was not resident in Canada is nil. Related persons, etc. (14) For the purposes of the definition qualified small business corporation share in subsection 110.6(1), (a) a taxpayer shall be deemed to have disposed of shares that are identical properties in the order in which the taxpayer acquired them; (b) in determining whether a corporation is a small business corporation or a Canadian-controlled private corporation at any time, a right referred to in paragraph 251(5)(b) shall not include a right under a purchase and sale agreement relating to a share of the capital stock of a corporation; (c) a personal trust shall be deemed (i) to be related to a person or partnership for any period throughout which the person or partnership was a beneficiary of the trust, and (ii) in respect of shares of the capital stock of a corporation, to be related to the person from whom it acquired those shares where, at the time the trust disposed of the shares, all of the beneficiaries (other than registered charities) of the trust were related to that person or would have been so related if that person were living at that time; (d) a partnership shall be deemed to be related to a person for any period throughout which the person was a member of the partnership; (d.1) a person who is a member of a partnership that is a member of another partnership is deemed to be a member of the other partnership; (e) where a corporation acquires shares of a class of the capital stock of another corporation from any person, it shall be deemed in respect of those shares to be related to the person where all or substantially all the consideration received by that person from the corporation in respect of those shares was common shares of the capital stock of the corporation; (f) shares issued after June 13, 1988 by a corporation to a particular person or partnership shall be deemed to have been owned immediately before their issue by a person who was not related to the particular person or partnership unless th