I am giving a talk on Tuesday at the Hamilton Law Association on tax issues in shareholder agreements. From my speaking notes:
The language of 251(5)(b) and subsection 256(1.4) appear to be very similar, but the CRA has maintained an importance difference in their interpretation: under the former, the CRA can treat a shareholder as owning all shares granted by a right but ignore the rights granted to others. The CRA states that the same rule does not apply to subsection 256(1.4).
The CRA has stated that, when determining whether two corporations are associated, “control of a corporation must be determined on the basis that all the rights granted are exercised simultaneously.”
