Income Tax Act — I-3.3 94
n respect of any taxation year under Divisions I and J, and (B) is subject to Part XV in respect of those rights and obligations, and (x) if the non-resident portion trust ceases to exist at a particular time (for greater certainty, as determined by clause (i)(B)) (A) the non-resident portion trust is deemed, at the time (referred to in this subparagraph as the “disposition time”) that is immediately before the time that is immediately before the particular time, to have (I) in the case of each property of the non-resident portion trust that is property described in any of subparagraphs 128.1(1)(b)(i) to (iv), disposed of the property for proceeds of disposition equal to the cost amount to it of the property at the disposition time, and (II) in the case of each other property of the non-resident portion trust, disposed of the property for proceeds of disposition equal to its fair market value of the property at the disposition time, (B) the particular trust is deemed to have acquired, at the time that is immediately before the particular time, each property described in subclause (A)(I) or (II) at a cost equal to the proceeds determined under that subclause in respect of the property, and (C) each person or partnership that is at the time immediately before the particular time a beneficiary under the non-resident portion trust is deemed (I) at the disposition time to have disposed of the beneficiary’s interest as a beneficiary under the non-resident portion trust for proceeds equal to the beneficiary’s cost amount in the interest at the disposition time, and (II) at the disposition time, to have ceased to be, other than for purposes of this clause, a beneficiary under the non-resident portion trust; and (g) if a person deducts or withholds any amount (referred to in this paragraph as the “withholding amount”) as required by section 215 from a particular amount paid or credited or deemed to have been paid or credited to the trust, and the particular amount has been included in the trust’s income for the particular taxation year, the withholding amount is deemed to have been paid on account of the trust’s tax under this Part for the particular taxation year. Excluded provisions (4) For greater certainty, paragraph (3)(a) does not deem a trust to be resident in Canada for the purposes of (a) the definitions arm’s length transfer and exempt foreign trust in subsection (1); (b) subsections (8.1) and (8.2), paragraph (14)(a), subsections 70(6) and 73(1), the definition Canadian partnership in subsection 102(1), paragraph 107.4(1)(c), the definition qualified disability trust in subsection 122(3), paragraph (a) of the definition mutual fund trust in subsection 132(6), the definition eligible trust in subsection 135.2(1) and subparagraph (b)(i) of the definition investment fund in subsection 251.2(1); (c) determining the liability of a person (other than the trust) that would arise under section 215; (d) determining whether, in applying subsection 128.1(1), the trust becomes resident in Canada at a particular time; (e) determining whether, in applying subsection 128.1(4), the trust ceases to be resident in Canada at a particular time; (f) subparagraph (f)(i) of the definition disposition in subsection 248(1); (g) determining whether subsection 107(5) applies to a distribution on or after July 18, 2005, of property to the trust; and (h) determining whether subsection 75(2) applies. Deemed cessation of residence — loss of resident contributor or resident beneficiary (5) A trust is deemed to cease to be resident in Canada at the earliest time at which there is neither a resident contributor to the trust nor a resident beneficiary under the trust in a taxation year (determined without reference to subsection 128.1(4)) of the trust (a) that immediately follows a taxation year of the trust throughout which it was deemed by subsection (3) to be resident in Canada for the purpose of computing its income; and (b) at a specified time in which t