TSX: TUI.UN
CALGARY, Feb. 19 /CNW/ - True Energy Trust ("True" or the "Trust"),
provides Canadian and US tax information for 2008.
Canadian Income Tax Information
The following information is intended to assist individual Canadian
unitholders of True in the preparation of their 2008 T1 Income Tax Returns.
Cash distributions in 2008 are 100% taxable as "other income" with no
return of capital.
Trust units held within an RRSP, RRIF or DPSP
No amounts are required to be reported on the 2008 T1 Income Tax Return
where Trust units are held within a Registered Retirement Saving Plan
("RRSP"), Registered Retirement Income Fund ("RRIF"), or a Deferred Profit
Sharing Plan ("DPSP").
Trust units held outside an RRSP, RRIF or DPSP
Unitholders who hold their Trust units outside of an RRSP, RRIF or DPSP
through a broker or other intermediary and who have received cash
distributions for the 2008 calendar year, will receive a "T3 Supplementary"
slip directly from their broker or intermediary, not from the transfer agent
of the Trust, Computershare Investor Services (the "Transfer Agent"), or the
Trust.
Registered Unitholders of Trust Units who have received cash
distributions for the 2008 calendar year from the Transfer Agent and not from
a broker or intermediary, will receive a "T3 Supplementary" slip directly from
the Transfer Agent.
Under Paragraph 12(1)(m) of the Income Tax Act, taxable amounts allocated
to the unitholders must be reported by the Unitholders in their 2008 Income
Tax Returns. Accordingly, the taxable amount of cash distributions received or
receivable for the period from January 1, 2008 up to and including December
31, 2008 are included in your "T3 Supplementary" slip. The amount reported in
Box (26) on the T3 slip should be reported on your T1 Income Tax Return as
"Other Income". The deadline for mailing all T3 Supplementary Information
slips as required by the Income Tax Act is March 31, 2009.
For the remaining tax deferred portion, if any, Unitholders are required
to reduce the adjusted cost base ( "ACB" ) of the trust units. Since the
return of capital for 2008 is nil, there should be no effect on the ACB.
Unitholders should maintain a record of all distributions that are classified
as a tax deferred distribution while holding the units.
U.S. Income Tax Information
The following information is provided for general information only.
Investors are encouraged to seek advice from a qualified tax advisor in their
country of residence to obtain guidance with respect to the appropriate tax
treatment of their distributions.
We believe that we are a corporation for United States federal income tax
purposes and, as a result, a distribution that we make on a unit is treated as
a dividend for United States federal income tax purposes. This treatment of
our distributions is based on the fact that we have not determined, and do not
intend to determine, our current or accumulated earnings and profits. In the
absence of such information, we believe that a United States person should
report our distributions as fully subject to United States federal income tax.
We believe such distributions should be considered "qualified dividends" for
purposes of United States income taxation. Such a dividend received by an
individual would be taxed by the United States at a maximum federal rate of 15
percent if such individual meets certain holding period requirements and
certain other requirements of the United States Internal Revenue Code are
satisfied.
The 15 percent Canadian non-resident withholding tax on distributions to
United States residents may be eligible for a foreign tax credit in the United
States. Any credit is subject to certain limitations imposed by the Internal
Revenue Code. Such Canadian withholding taxes cannot be used as a credit
against such federal income taxes if such taxes can be recovered from Canada
as an overpayment.
General
The information in this release is not intended to be an exhaustive
discussion of all possible income tax consequences but a general guideline. It
is not intended to be legal or tax advice to any particular holder or
potential holder of units. The holders or potential holders of units should
consult their own tax advisors as to their particular tax consequences and
reporting obligations.
True Energy Trust is an exploration and production oil and gas trust
based in Calgary, Alberta, Canada.
%SEDAR: 00021401E
