No Capital Gains Exemption for Donations of Real Estate and
Shares of Private Corporations
Budget 2016 announces the Government's intention to reverse
proposals made in Budget 2015 with respect to donations of the cash
proceeds from sales of real estate and private company shares.
Budget 2015 proposed to exempt from tax capital gains incurred on
the sale of real estate and private company shares to the extent
the cash proceeds from the sale of such property were donated to a
registered charity within 30 days of the sale. These changes were
to take effect starting in 2017 and draft legislation implementing
these changes had been released. We reported on these measures in
pastissues of this Newsletter. Budget 2016
confirms that the Government does not intend to go forward with
This announcement will come as a disappointment to some in the
charitable sector, which had lobbied for relief from capital gains
in respect of donations of real estate and private company shares.
Others – for example, charities specifically eligible to
receive gifts of ecological property – may not be
disappointed by this measure.
The Budget does not affect the tax credits or deductions
normally available for in-kind gifts of real estate or private
company shares. Gifts of publicly-listed securities are also not
affected by the Budget announcement, and will continue to be exempt
from tax on capital gains.
Investments by Charities in Limited Partnerships
The Budget confirms the Government's intention to
"proceed with tax and related measures, as modified, to take
into account consultations and deliberations since their
announcement or release, relating to ... the acquisition or holding
of limited partnership interests by registered charities." As
reported previously in this Newsletter, Budget 2015
introduced relieving provisions allowing direct investment in
limited partnerships by registered charities provided certain
conditions are met. It appears that the Government will preserve
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Under the Income Tax Act, the Employment Insurance Act, and the Excise Tax Act, a director of a corporation is jointly and severally liable for a corporation's failure to deduct and remit source deductions or GST.
Under the Income Tax Act, the Employment Insurance Act, the Canada Pension Plan Act and the Excise Tax Act, a director of a corporation is jointly and severally liable for a corporation's failure to deduct and remit source deductions.
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