Income Tax Regulations

3701 (1) For the purposes of clause 149.1(1)(e)(iv)(A) of the Act, the prescribed amount referred to therein for a taxation year of a charitable foundation shall be determined in accordance with the following rules:

• (a) choose a number, not less than two and not more than eight, of equal and consecutive periods that total twenty-four months and that end immediately before the beginning of the year;

• (b) aggregate for each period chosen under paragraph (a) all amounts, each of which is the value, determined in accordance with section 3702, of property or a portion thereof owned by the foundation, and not used directly in charitable activities or administration, on the last day of the period;

• (c) aggregate all amounts, each of which is the aggregate of values determined for each period under paragraph (b); and

• (d) divide the aggregate amount determined under paragraph (c) by the number of periods chosen under paragraph (a).

(2) For the purposes of subsection (1) and subject to subsection (3),

• (a) the number of periods chosen by a charitable foundation under paragraph (1)(a) shall, unless otherwise authorized by the Minister, be used for the taxation year and for all subsequent taxation years; and

• (b) a charitable foundation shall be deemed to have existed on the last day of each of the periods chosen by it.

(3) The number of periods chosen under paragraph (1)(a) may be changed by the foundation for its first taxation year commencing after 1986 and the new number shall, unless otherwise authorized by the Minister, be used for that taxation year and all subsequent taxation years.