Acts and Regulations

2015, c.21 - Trustees Act

Section 40
Disposition versions

Full text
Apportionment of outgoings
40(1)This section does not apply in respect of the following trusts unless the trust instrument expressly provides otherwise:
(a) an alter ego trust;
(b) a joint spousal or common-law partner trust;
(c) a post-1971 spousal or common-law partner trust; and
(d) a pre-1972 spousal trust.
40(2)The trustees may charge all or part of an outgoing to the income or capital of the trust as the trustees consider is
(a) just and equitable in the circumstances,
(b) in accordance with ordinary business practice, and
(c) in the best interests of the beneficiaries or purposes of the trust.
40(3)If the amount of an outgoing charged to the income or capital of the trust under subsection (2) is not equal to the amount paid out of the income or capital in respect of the outgoing, the trustees may allocate an amount between income and capital to recover or reimburse the payment in respect of the outgoing.
40(4)If trust property is subject to depreciation, the trustees may
(a) deduct from the income earned from the trust property an amount that the trustees consider is
(i) just and equitable in the circumstances,
(ii) in accordance with ordinary business practice, and
(iii) in the best interests of the beneficiaries or purposes of the trust, and
(b) add that amount to the capital of the trust.
Apportionment of outgoings
40(1)This section does not apply in respect of the following trusts unless the trust instrument expressly provides otherwise:
(a) an alter ego trust;
(b) a joint spousal or common-law partner trust;
(c) a post-1971 spousal or common-law partner trust; and
(d) a pre-1972 spousal trust.
40(2)The trustees may charge all or part of an outgoing to the income or capital of the trust as the trustees consider is
(a) just and equitable in the circumstances,
(b) in accordance with ordinary business practice, and
(c) in the best interests of the beneficiaries or purposes of the trust.
40(3)If the amount of an outgoing charged to the income or capital of the trust under subsection (2) is not equal to the amount paid out of the income or capital in respect of the outgoing, the trustees may allocate an amount between income and capital to recover or reimburse the payment in respect of the outgoing.
40(4)If trust property is subject to depreciation, the trustees may
(a) deduct from the income earned from the trust property an amount that the trustees consider is
(i) just and equitable in the circumstances,
(ii) in accordance with ordinary business practice, and
(iii) in the best interests of the beneficiaries or purposes of the trust, and
(b) add that amount to the capital of the trust.