Income Tax Act — I-3.3 40
ich it would, if the taxpayer had designated it in prescribed manner to have been the taxpayer’s principal residence for that year, have been the taxpayer’s principal residence, and (ii) in any case where subsection 73(1) is applicable, for any taxation year for which it was the taxpayer’s principal residence; and (c) where the individual is a trust, the trust shall be deemed to have been resident in Canada during each taxation year during which the taxpayer was resident in Canada. (5) [Repealed, 1994, Sch. VIII, c. 7, s. 12] Principal residence — property owned at end of 1981 (6) Subject to subsection (6.1), if a property was owned by a taxpayer, whether jointly with another person or otherwise, at the end of 1981 and continuously from the beginning of 1982 until disposed of by the taxpayer, the amount of the gain determined under paragraph (2)(b) in respect of the disposition shall not exceed the amount, if any, by which the total of (a) the taxpayer’s gain calculated in accordance with paragraph 40(2)(b) on the assumption that the taxpayer had disposed of the property on Dec ember 31, 1981 for proceeds of disposition equal to its fair market value on that date, and (b) the taxpayer’s gain calculated in accordance with paragraph 40(2)(b) on the assumption that that paragraph applies and that (i) the taxpayer acquired the property on January 1, 1982 at a cost equal to its proceeds of disposition as determined under paragraph 40(6)(a), and (ii) the description of B in paragraph 40(2)(b) is read without reference to “one plus” exceeds (c) the amount, if any, by which the fair market value of the property on December 31, 1981 exceeds the proceeds of disposition of the property determined without reference to this subsection. Principal residence — property owned at end of 2016 (6.1) If a trust owns property at the end of 2016, the trust is not in its first taxation year that begins after 2016 a trust described in subparagraph (c.1)(iii.1) of the definition principal residence in section 54, the trust disposes of the property after 2016, the disposition is the trust’s first disposition of the property after 2016 and the trust owns the property, whether jointly with another person or otherwise, continuously from the beginning of 2017 until the disposition, (a) subsection (6) does not apply to the disposition; and (b) the trust’s gain determined under paragraph (2)(b) in respect of the disposition is the amount, if any, determined by the formula A + B − C where A is the trust’s gain calculated in accordance with paragraph (2)(b) on the assumption that (i) the trust disposed of the property on December 31, 2016 for proceeds of disposition equal to its fair market value on that date, and (ii) paragraph (a) did not apply in respect of the disposition described in subparagraph (i), B is the trust’s gain in respect of the disposition calculated in accordance with paragraph (2)(b) on the assumption that (i) the description of B in that paragraph is read without reference to “one plus”, and (ii) the trust acquired the property on January 1, 2017 at a cost equal to its fair market value on December 31, 2016, and C is the amount, if any, by which the fair market value of the property on December 31, 2016 exceeds the proceeds of disposition of the property determined without reference to this subsection. Property in satisfaction of interest in trust (7) Where property has been acquired by a taxpayer in satisfaction of all or any part of the taxpayer’s capital interest in a trust, in circumstances to which subsection 107(2) applies and subsection 107(4) does not apply, for the purposes of paragraph 40(2)(b) and the definition principal residence in section 54 the taxpayer shall be deemed to have owned the property continuously since the trust last acquired it. Effect of election under subsection 110.6(19) (7.1) Where an election was made under subsection 110.6(19) in respect of a property of a taxpayer that was the taxpayer’s principal residen