The Department of Finance released on December 6, 2004, draft legislation implementing the March 23, 2004 Budget proposals. This note will describe the Amendments directed at the investment fund sector, and principally, income trust investments made by non-residents. The Amendments include a withholding tax on distributions made to non-residents from gains realized on taxable Canadian property and other similar property, and a new distribution tax of 15% on otherwise non-taxable distributions made by royalty funds and REITs to non-residents.

type Tax Law/Investment Funds Bulletin - February 2005