Tax Memo: New Tax Era for Private Foundations
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A Notice of Ways and Means Motion tabled in the House of Commons on November 13, 2007, enhances Canada’s tax incentives for individuals, corporations and trusts that donate publicly listed securities to private foundations, by extending the capital gains exemption to these gifts. However, to address the government’s concerns regarding potential self-dealing opportunities for a private foundation and persons not dealing at arm’s length with the foundation, the draft legislation restricts a private foundation’s significant holdings in corporations and may expose private foundations to increased tax governance. The draft legislation refines draft rules released on October 2, 2007, that implement measures introduced in the March 19, 2007 federal budget.
