The taxation year of a GRE ends at the time it is terminated (all of its assets are distributed) during a year. See paragraph 249(1)(b) and subsection 249(5) of the Income Tax Act (Canada) (the “Act”). On the other hand, the taxation year of an inter vivos trust always ends on December 31 of a year even if it is terminated earlier in that year. See paragraph 249(1)(c) of the Act.
STEP Round Table 2022, question 10, summarized in Tax Topics no 2657 (February 7, 2023)
