FORM 20-F/A Brookfield Property Partners L.P. - Brookfield Asset ...

CFA in respect of which the FAPI was included. At such time as the Property Partnership receives a dividend ofthis type of income that was previously treated as FAPI, that dividend will effectively not be taxable to theProperty Partnership and there will be a corresponding reduction in the adjusted cost base to the PropertyPartnership of the particular CFA shares. Under the Foreign Tax Credit Generator Proposals, the “foreign accrualtax” applicable to a particular amount of FAPI included in a partnership’s income in respect of a particular“foreign affiliate” of the partnership may be limited in certain specified circumstances, including where the shareof the income of any member of the partnership that is a person resident in Canada is, under the income tax lawsof any country (other than Canada) under whose laws the income of the partnership is subject to income taxation,less than its share thereof for purposes of the Tax Act. No assurances can be given that the Foreign Tax CreditGenerator Proposals will not apply to the Property Partnership. If the Foreign Tax Credit Generator Proposalsapply, the “foreign accrual tax” applicable to a particular amount of FAPI included in the Property Partnership’sincome in respect of a particular “foreign affiliate” of the Property Partnership will be limited.Disposition of Our UnitsThe disposition by a Canadian Limited Partner of a unit of our company will result in the realization of acapital gain (or capital loss) by such limited partner. The amount of such capital gain (or capital loss) willgenerally be the amount, if any, by which the proceeds of disposition of a unit, less any reasonable costs ofdisposition, exceed (or are exceeded by) the adjusted cost base of such unit. In general, the adjusted cost base of aCanadian Limited Partner’s units of our company will be equal to (i) the actual cost of the units (excluding anyportion thereof financed with limited recourse indebtedness) whether acquired pursuant to the spin-off, thedistribution reinvestment plan or otherwise, plus (ii) the pro rata share of the income of our company allocated tothe Canadian Limited Partner for the fiscal years of our company ending before the relevant time less (iii) theaggregate of the pro rata share of losses of our company allocated to the Canadian Limited Partner (other thanlosses which cannot be deducted because they exceed the Canadian Limited Partner’s “at-risk” amount) for thefiscal years of our company ending before the relevant time and the Canadian Limited Partner’s distributionsfrom our company made before the relevant time. The adjusted cost base of each of our units will be subject tothe averaging provisions contained in the Tax Act.Where a Canadian Limited Partner disposes of all of its units of our company, such person will no longerbe a partner of our partnership. If, however, a Canadian Limited Partner is entitled to receive a distribution fromour company after the disposition of all such units, then the Canadian Limited Partner will be deemed to disposeof the units at the later of: (i) the end of the fiscal year of our company during which the disposition occurred;and (ii) the date of the last distribution made by our company to which the Canadian Limited Partner wasentitled. Pursuant to the Tax Proposals, the pro rata share of the income (or loss) for tax purposes of ourcompany for a particular fiscal year which is allocated to a Canadian Limited Partner who has ceased to be apartner will generally be added (or deducted) in the computation of the adjusted cost base of the CanadianLimited Partner’s units immediately prior to the time of the disposition. These rules are complex and CanadianLimited Partners should consult their own tax advisors for advice with respect to the specific tax consequences tothem of disposing of units of our company.A Canadian Limited Partner will realize a deemed capital gain if, and to the extent that, the adjusted costbase of the Canadian Limited Partner’s units of our company is negative at the end of any of our fiscal years. Insuch a case, the adjusted cost base of the Canadian Limited Partner’s units of our company will be nil at thebeginning of our next fiscal year.Capital Gains and Capital LossesIn general, one-half of a capital gain realized by a Canadian Limited Partner must be included incomputing such Canadian Limited Partner’s income as a taxable capital gain. One-half of a capital loss isdeducted as an allowable capital loss against taxable capital gains realized in the year and any remainder may bededucted against taxable capital gains in any of the three years preceding the year or any year following the yearto the extent and under the circumstances described in the Tax Act.183