Tax exemption amendments clarify substantial government financing test and alter income treatment for institutions and business trusts. Amendments clarify that institutions are substantially financed by the Government where government grants exceed a prescribed percentage of total receipts; approved or notified entities' income received on their behalf is included in the recipient's total income for that year; income required to be applied or accumulated is calculated without deduction for depreciation where the asset acquisition has been claimed as application of income. The amendments also treat interest from a special purpose vehicle to a business trust as non-exempt and address taxation of distributed income to unit holders, while expanding exempt unit definitions to include business trust units.
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Provisions expressly mentioned in the judgment/order text.
Tax exemption amendments clarify substantial government financing test and alter income treatment for institutions and business trusts.
Amendments clarify that institutions are substantially financed by the Government where government grants exceed a prescribed percentage of total receipts; approved or notified entities' income received on their behalf is included in the recipient's total income for that year; income required to be applied or accumulated is calculated without deduction for depreciation where the asset acquisition has been claimed as application of income. The amendments also treat interest from a special purpose vehicle to a business trust as non-exempt and address taxation of distributed income to unit holders, while expanding exempt unit definitions to include business trust units.
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