Offer to purchase CLEARNET.pdf - About TELUS

also be taxable Canadian property where the Non-Resident Shareholder elected to have them treated as taxable
Canadian property upon ceasing to be a resident of Canada or where the shares were acquired under
circumstances in which they are deemed to be taxable Canadian property.
Subsequent Transactions
The consequences under the Tax Act to a Non-Resident Shareholder of a Compulsory Acquisition would
generally be the same as those with respect to Shareholders that are resident in Canada except that the
Non-Resident Shareholder would not be subject to taxation under the Tax Act in respect of any capital gain that
is recognized unless the Non-Resident Shareholder’s Clearnet Non-Voting Shares are ‘‘taxable Canadian
property’’, as described above, and the Non-Resident Shareholder is not afforded any relief under an applicable
tax treaty.
To the extent that any Subsequent Acquisition Transaction is proposed, Non-Resident Shareholders are
urged to consult their own tax advisors to determine the tax consequences to them of the transaction and in
particular whether any shares held by them during the course of the Subsequent Acquisition Transaction would
be held by them as ‘‘taxable Canadian property’’.
If in the course of a Subsequent Acquisition Transaction shares are acquired by the issuer from a
Non-Resident Shareholder (including upon the exercise by a Non-Resident Shareholder of certain dissent
rights), the Non-Resident Shareholder would be deemed to have received a dividend equal to the amount by
which the amount received (other than in respect of interest awarded by a court) exceeds the paid-up capital of
the shares. Any deemed dividend would be subject to Canadian withholding tax at the rate of 25% unless the
rate is reduced under the provisions of an applicable tax treaty. The Non-Resident Shareholder would also be
considered to have disposed of the shares for proceeds of disposition equal to the amount received by the
Non-Resident Shareholder less the amount of any deemed dividend referred to above and any interest awarded
by a court. Any capital gain recognized on the disposition of the Non-Resident Shareholder’s shares would not
be subject to tax under the Tax Act unless such shares are ‘‘taxable Canadian property’’ and the Non-Resident
Shareholder is not afforded any relief under an applicable tax treaty.
Interest awarded to a dissenting Non-Resident Shareholder by a court will be subject to Canadian
withholding tax at the rate of 25% unless the rate is reduced under the provisions of an applicable tax treaty.
UNITED STATES FEDERAL INCOME TAX CONSIDERATIONS
The following is a summary of the material United States federal income tax consequences to Clearnet
shareholders that are individuals who are citizens or residents of the United States, United States domestic
corporations, or that are otherwise subject to United States federal income tax on a net basis in respect of a
disposition of the Clearnet Shares, of the sale of Clearnet Shares pursuant to the Offers for cash and/or TELUS
Non-Voting Shares. The summary does not purport to be a description of all tax consequences that may be
relevant to a Clearnet shareholder, and assumes an understanding of tax rules of general application. It does not
address special rules which may apply to Clearnet shareholders based on their tax status, individual
circumstances or other factors unrelated to the Offers. Shareholders are encouraged to consult their own tax
advisors regarding the Offers.
The receipt of cash and/or TELUS Non-Voting Shares in exchange for Clearnet Shares pursuant to the
Offers will be a taxable transaction for federal income tax purposes, and may also be taxable under applicable
state, local, foreign and other tax laws. For federal income tax purposes, a Shareholder whose Clearnet Shares
are purchased pursuant to the Offers will realize gain or loss equal to the difference between (x) the adjusted
basis of the Clearnet Shares sold and (y) the sum of the amount of cash and the fair market value, at the time of
the sale, of the TELUS Non-Voting Shares received therefor. Such gain or loss will be capital gain or loss if the
Clearnet Shares are held as capital assets by the Shareholder and will be long-term capital gain or loss if the
Shareholder’s holding period in such Clearnet Shares for federal income tax purposes is more than one year at
the time of the sale. Long-term capital gain of a non-corporate shareholder is generally subject to a maximum
tax rate of 20 percent. In addition, a Shareholder’s ability to use capital losses to offset ordinary income
is limited.
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