According to Canadian tax law, as of 2009, a self-interest would be recognized by the Canada Tax Agency if pursuant to the trust's constitution,and once created, during the settlor's life, the settlor alone must be entitled to all of the income or capital of the trust nor can he or she be replaced as beneficial owner.
Also known as an alter ego trust.
REFERENCES:
- Canadian Estate Planning Guide (Toronto: CCH Canadian Limited, 2008), page 5038-5039-3
- Duhaime, Lloyd, Elder Law, Wills, Trusts and Estates
- Income Tax Act, Revised Statutes of Canada 1985, Chapter 1, 5th Suppl., §73(1.02)(b)(ii)