Administrative Policy
11 June 2015 Folio S4-F5-C1
1.18 In respect of shares which are rolled over under subsection 85.1(1), subsection 26(26) of the ITAR provides that where the exchanged shares were owned by the vendor on December 31, 1971 and thereafter without interruption until the time of the exchange, the shares of the purchaser are deemed to be those same shares owned on December 31, 1971. The tax-free zone is thereby preserved.
1.19 By virtue of subsection 26(28) of the ITAR, subsection 26(26) of the ITAR will apply to the exchanged shares even though there has been a previous application of any of subsections 26(5), (21), (24), (26) or (27) of the ITAR to those shares. …