REVENUE CANADA TAXATION

INTERPRETATION BULLETIN NUMBER: IT-448SR 
 
DATE: June 21, 1982 
 
SUBJECT: INCOME TAX ACT 
Dispositions - Changes in Terms of Securities 
 
REFERENCE: SPECIAL RELEASE 
 
The purpose of this Special Release is to modify the 
Department's position as to whether a disposition occurs on 
the reduction in the paid-up capital of a share of the 
capital stock of a corporation. Accordingly, paragraphs 12 
and 13 of IT-448 are to be replaced with the following: 
 
"A reduction in paid-up capital that involves the 
redemption (see 2 above), or cancellation of a share gives 
rise, by necessity, to a disposition in the hands of the 
holder by virtue of clause 54(c)(ii)(A) of the Act. 
However, a reduction in the paid-up capital in respect of a 
share, not accompanied by a redemption or cancellation of 
that share, will not constitute a disposition of that 
share".