U.S. Tax Information
The following information is being provided to assist U.S. Investors in reporting distributions received on their IRS Form 1040 – U.S. Individual Income Tax Return. This summary is of a general nature only and is not intended to be, nor should it be construed to be legal, business or tax advice to any particular holder. U.S. Investors should consult their own tax advisors regarding the income tax considerations applicable to them in their particular circumstances.
Effective July 8, 2011, Canexus Income Fund converted to Canexus Corporation. This conversion should qualify as a tax deferred transaction for U.S. tax purposes. As a result of such treatment, U.S. Holders should not generally recognize a gain or loss for U.S. federal income tax purposes. Any distributions received subsequent to July 15, 2011 will be treated as dividends to the extent that it is paid out of the Corporations current or accumulated earnings and profits (as determined under U.S. federal income tax principals). Dividends paid during 2011 to non-corporate U.S. Holders should be eligible for treatment as qualified dividend income, provided the holding period and other requirements are met by the U.S. Holder. U.S. Holders will be taxed on the U.S. dollar value of the Canadian dollars received, generally determined at the spot rate as of the date the payment is actually received.
The Corporation has not received an IRS letter ruling or a formal tax opinion from its tax advisors on these matters. U.S. Holders should consult their individual tax advisors regarding the proper tax reporting.
|Total Dividend/Share||Record Date||Payment Date|
|$0.1368||Sep 30, 2011||Oct 17, 2011|
|$0.1368||Dec 31, 2011||Jan 16, 2012|
|$0.1368||Mar 31, 2012||Apr 16, 2012|
|$0.1368||Jun 30, 2012||Jul 16, 2012|
|$0.1368||Sep 30, 2012||Oct 15, 2012|
|$0.1368||Dec 31, 2012||Jan 15, 2013|
|$0.1368||Mar 31, 2013||Apr 15, 2013|
|$0.1368||Jun 30, 2013||Jul 15, 2013|
|$0.1368||Sep 30, 2013||Oct 15, 2013|
|$0.1368||Dec 31, 2013||Jan 15, 2014|
|$0.1368||Mar 31, 2014||Apr 15, 2014|
|$0.1000||Jun 30, 2014||Jul 15, 2014|
|$0.1000||Sep 30, 2014||Oct 15, 2014|
|$0.1000||Dec 31, 2014||Jan 15, 2015|
|$0.0100||Mar 31, 2015||Apr 15, 2015|
|$0.0100||Jun 30, 2015||Jul 15, 2015|
|$0.0100||Sep 30, 2015||Oct 15, 2015|
Canexus Income Fund
In consultation with its U.S. tax advisors, the Fund believes that the units of the Fund more likely than not will be properly classified as equity in a corporation, rather than debt, for U.S. federal income tax purposes and that distributions paid to individual U.S. unitholders will more likely than not be "qualified dividends" for U.S. federal income tax purposes. As such, the portion of the distributions made that are considered dividends for U.S. federal income tax purposes should qualify for the reduced rate of tax applicable to long-term capital gains (where the holder meets certain criteria).
Provided the Fund distributions are considered to be qualified dividends as noted above, the Fund has determined that 100 percent of distributions paid up to July 15, 2011 will be taxable for U.S. tax purposes as "qualified dividends" with no return of capital.
The Fund has not received an IRS letter ruling or a formal tax opinion from its tax advisors on these matters. U.S. Holders should consult their individual tax advisors.
|Total Distributions per Unit (CDN$)|
Foreign Tax Credit Limitations
U.S. Holders may be subject to a minimum 15% Canadian withholding tax on payments distributed on shares/units held within a taxable U.S. account. Subject to certain conditions and limitations, such withholding taxes may be treated as foreign taxes eligible for credit against a U.S. Holder's U.S. federal income tax liability.