Income Tax Act — I-3.3 144
ees profit sharing plan during a taxation year or within 120 days thereafter may be deducted in computing the employer’s income for the taxation year to the extent that it was not deductible in computing income for a previous taxation year. Beneficiary’s receipts deductible (6) An amount received in a taxation year by a beneficiary from a trustee under an employees profit sharing plan shall not be included in computing the beneficiary’s income for the year. Beneficiary’s receipts that are not deductible (7) Notwithstanding subsection 144(6), such portion of an amount received in a taxation year by a beneficiary from the trustee under an employees profit sharing plan as cannot be established to be attributable to (a) payments made by the employee to the trustee, (b) amounts required to be included in computing the income of the employee for that or a previous taxation year, (c) a capital gain made by the trust before 1972, (d) a capital gain made by the trust for a taxation year ending after 1971, to the extent allocated by the trust to the beneficiary, (e) a gain made by the trust after 1971 from the disposition of a capital property, except to the extent that the gain is a capital gain made by the trust for a taxation year ending after 1971, (f) the portion, if any, of the increase in the value of property transferred to the beneficiary by the trustee that would have been considered to be a capital gain made by the trust in 1971 if the trustee had sold the property on December 31, 1971 for its fair market value at that time, or (g) a dividend received by the trust from a taxable Canadian corporation other than a dividend described in subsection 83(1), to the extent allocated by the trust to the beneficiary, shall be included in computing the beneficiary’s income for the year in which the amount was received, except that in determining the amount of any payments or other things described in any paragraph of this subsection, the amount thereof otherwise determined shall be reduced by such portion of the total of all capital losses of the trust for taxation years ending after 1971 as has been allocated by the trust to the beneficiary and has not been applied to reduce the amount of any payments or other things described in any other paragraph of this subsection. Where property other than money received by beneficiary (7.1) Where, at any particular time in a taxation year of a trust governed by an employees profit sharing plan, an amount was received by a beneficiary from the trustee under the plan and the amount so received was property other than money, the following rules apply in respect of each such property so received by the beneficiary at the particular time: (a) the amount that was the cost amount to the trust of the property immediately before the particular time shall be deemed to be the trust’s proceeds of disposition of the property; (b) that proportion of (i) such portion of the amount received by the beneficiary as can be established to be attributable to the payments or other things described in paragraphs 144(7)(a) to 144(7)(g) (on the assumption that the amount of any payments or other things described in any such paragraph is the amount thereof determined as provided in subsection 144(7)) that (ii) the cost amount to the trust of the property immediately before the particular time is of (iii) the cost amounts to the trust of all properties, other than money, so received by the beneficiary at the particular time, is subject to paragraph 144(7.1)(c), deemed to be (iv) the cost to the beneficiary of the property, and (v) for the purposes of subsection 144(7) but not for the purposes of this subsection, the amount so received by the beneficiary by virtue of the receipt by the beneficiary of the property; and (c) where a particular property received is all or a portion of property received in satisfaction of all or a portion of the beneficiary’s interests in the trust and the beneficiary files with the Minister on o