Public foundation had to have more than one trustee

Federal appeal | Taxation

INCOME TAX

Public foundation had to have more than one trustee

Appellant foundation was charitable foundation and registered charity. Appellant had single trustee. All or substantially all of capital contributed to appellant trust was contributed by settlor, wife and entities controlled by them. Minister confirmed appellant’s designation as private foundation. Minister concluded appellant could not qualify as public foundation because trustee could not satisfy arm’s length trustee requirement. Appeal was dismissed. Minister correctly designated appellant to be private foundation. As long as appellant had single trustee, appellant could not be public foundation. Parliament in definition in s. 149.1 of Income Tax Act (Can.), signaled intention that there had to be more than one trustee of public foundation. Review of legislative context and purpose supported interpretation that public foundation had to have more than one trustee.

Sheldon Inwentash and Lynn Factor Charitable Foundation v. Canada (May 4, 2012, F.C.A., Dawson, Trudel and Stratas JJ.A., File No. A-235-11) 216 A.C.W.S. (3d) 502 (25 pp.).

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