and Revenue Administration
Unclaimed Personal Property and Vested Property Act
||March 8, 2012
|| Alberta Treasury Board and Finance, Tax
and Revenue Administration
|For more information:
UP-1R1 / March 2012
UNCLAIMED PERSONAL PROPERTY AND VESTED PROPERTY ACT INFORMATION CIRCULAR:
NOTE: This information circular is intended to explain legislation and provide specific information. Every effort has been made to ensure the contents are accurate. However, if a discrepancy should occur in interpretation between this information circular and governing legislation, the legislation takes precedence.
- The Unclaimed Personal Property and Vested Property Act (the Act) came into effect on September 1, 2008. The Act established a registry for unclaimed property as a service for owners to locate abandoned or forgotten property. The registry is administered by Tax and Revenue Administration (TRA) on behalf of the Minister of Finance.
- In general, the holder of property that is presumed abandoned by its owner is required to report and transfer the abandoned property or its cash equivalent to TRA. Property is presumed abandoned if unclaimed by the owner within applicable periods provided in the regulations. TRA will keep the unclaimed property in trust for the owner for up to 10 years after it has been received. During that time the apparent owner or other claimant can submit a claim for the return of the property.
- The Act does not apply to unclaimed property that falls under the jurisdiction of any other Alberta or federal legislation (e.g., Canada’s Bank Act).
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- Unclaimed personal property is an asset that has not had any owner activity for some time. The amount of inactive time required for the asset to be considered unclaimed depends on the type of asset. The specific period of time is explained in section 6 of the Regulation and a general list of properties and their dormancy periods are available in Appendix A, Information Circular UP-2, Property Holders. The net value of unclaimed property must be $250 or more for intangible property and $1,000 or more for tangible property.
- A holder is a person or entity such as a business that keeps or maintains property, both tangible and intangible, for an owner.
- A claimant is a person or entity, such as a business, that owns property or is the legal representative of a person or entity that owns property held by TRA under this program. A claimant can also be a creditor with a legal and/or financial interest in the unclaimed property. Claimants can make a claim on the property held by TRA within 10 years of the property being turned over to TRA.
- Tangible personal property is any physical property, such as artwork, jewellery and furniture, that is not land.
- Intangible personal property is an interest held, issued or owing by a business organization, government or governmental organization, and can include:
- money or a cheque, money order, traveller’s cheque, draft, deposit, interest or dividend;
- a security deposit, refund, credit balance, unpaid wage or salary, unused ticket or unidentified remittance;
- a security certificate or other evidence of ownership of an interest in a business organization;
- a security or security entitlement;
- a bond, debenture, note or other evidence of indebtedness;
- money deposited to redeem shares, bonds, coupons or other securities or to make distributions;
- an amount due and payable under the terms of an annuity or insurance policy, including a policy providing life insurance, property and casualty insurance, workers’ compensation insurance or accident and sickness insurance; or
- an amount distributable from a trust or from a custodial fund established under a plan to provide education, health, welfare, vacation, severance, death, share purchase, profit‑sharing, employee savings, supplemental unemployment insurance or similar benefits.
- Vested property is both land and personal property that comes under ownership of the Crown (Government of Alberta), under the following conditions:
- When a business, society or cooperative ceases operations or does not file an annual return with the Corporate Registry, it can become dissolved. A dissolved business legally ceases to exist. Any property not disposed of when the business is dissolved becomes the property of the Crown.
- If, after two years, the personal representative of an Alberta resident who has died without a will (intestate) has not learned of any persons entitled to the estate, the representative must transfer the intestate’s property to TRA.
- Any person with a legal claim to the property held, including the property acquired under the two previous conditions, can file a claim, within 10 years of TRA receiving the property to prove his/her entitlement. If no claim has been submitted after 10 years, then the property goes to the Crown permanently. For more information about filing a claim, refer to Information Circular UP-3, Claiming Personal and Vested Property.
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- As a holder, you must decide when property in your possession is considered unclaimed. The time period for calculating when unclaimed personal property is considered abandoned began on September 1, 2008. If you have been unable to obtain a response from the owner of the property after a certain period of time, then you must pay, transfer or deliver the property (or a cash equivalent) to TRA. This applies to any abandoned property in your books of account after September 1, 2008.
- Between three and eight months before the property becomes transferable to TRA, you are required to write a letter or send a statement to the owner advising him/her that the property may be declared unclaimed. (If you know that the owner’s last known address is invalid, you do not have to issue a notice; however, provide this information when reporting the property. The owner can respond or update his/her account with you to prevent the property from becoming unclaimed. If there is no response, you conclude the property is unclaimed.
- You are requested to submit a list of all property unclaimed as of December 31 each year, using the online process, “Submit Property” on the Alberta Treasury Board and Finance Unclaimed Property website. On payment transfers of property, please include a copy of your property submission with your payment. For more information about holder responsibilities, please see Information Circular UP-2, Property Holders.
- Vested property can come from a dissolved corporation, society or cooperative. If the corporation, society or cooperative is revived within five years of September 1, 2008 or the date of dissolution (whichever is the later), then it may file a claim for any property that was transferred to TRA. The claim can only be filed by the revived corporation. Shareholder(s) of the business can only make a claim if the corporation is not revived, the revival period has passed, or there are extraordinary circumstances.
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- All unclaimed property is held by TRA in its original form or cash equivalent for 10 years, to allow a claim to be made.
- TRA may exercise all rights and powers of an owner of the unclaimed property held. Revenue earned on an unclaimed property becomes the property of the Crown.
- TRA may charge reasonable expenses, including administration fees, while holding the unclaimed property. Before a claim is processed, TRA may require the claimant to pay the amount of expenses over and above the revenue earned on the property and any outstanding holder fees.
- Where property has been transferred as unclaimed to TRA or the Minister has filed a caveat on vested land, a creditor claiming a security interest in property or registered interest in vested land is required to give notice of a proposed enforcement action to both the owner and TRA.
- A creditor that has enforced the security interest in unclaimed property is required to pay to TRA the amount over and above what the creditor is entitled to from the sale or disposition of the property.
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- Any agreement, other than that between a lawyer and an apparent owner, for a third party to recover unclaimed property on behalf of the apparent owner must be made in writing, clearly set out the terms, and be signed by the apparent owner. The compensation paid to the third party for recovering the property is limited to 10 per cent of the value of the property, as determined by TRA. The original value is determined when the property was received and is adjusted for any income or expenses incurred.
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- Any person, government organization or other entity may apply to TRA to claim property held by TRA. The claimant is required to provide satisfactory proof of ownership to support the claim. TRA will review the claim within 120 days of receipt of the claim. If additional supporting documentation is required, additional time may be needed to review the claim.
- If the claim is approved, TRA will, within 30 days:
- return the property to the claimant, if it is in its original form and there are no amounts owing.
- provide the claimant with a summary of the amounts the claimant is required to pay before the property is returned, if the property is in its original form and there are amounts owing. The amount owing must be paid within 120 days. The property will be returned to the claimant within 30 days of receipt of the amount owing.
- pay the net proceeds of any property disposed of less any expenses and administration fees charged, if the property has been liquidated.
- If the claimant does not pay the amount owing within 120 days, TRA can sell the property and pay the net proceeds to the claimant within 30 days of the date of sale.
- Vested property that has been leased or otherwise encumbered remains leased or otherwise encumbered.
- Except when TRA determines that extraordinary circumstances exist, no claim can be made for property that has been held by TRA for more than ten years. After that time, the owner loses all rights to the property.
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- A claimant may object to a decision made or amount set by TRA by filing an "Unclaimed Property Notice of Objection" form (AT4954) within 120 days of TRA’s notice.
- TRA may at any time request, in writing, an abandoned property from its holder. The holder is required to pay, transfer or deliver the property to TRA within 120 days of receiving the request.
- A holder may object to paying, transferring or delivering the property to TRA. Form AT4954, "Unclaimed Property Notice of Objection," must be delivered to TRA within 120 days of either December 31 of the year that the property was considered unclaimed or the receipt of the request from TRA.
- Unless appealing, a holder is obligated to comply with the final decision resulting from the objection within 60 days of receipt.
- The holder has 30 days from receiving the final decision to appeal to the Court of Queen’s Bench.
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SET-OFFS OF OUTSTANDING DEBTS TO THE GOVERNMENT OF ALBERTA
- TRA may use proceeds from the sale of unclaimed property to reduce or pay out any amount the owner owes the Government of Alberta. A ministry may submit a claim as a creditor to satisfy any outstanding debts. A statement is required from the ministry as proof of the debt. TRA will notify the claimant of any set-off and any excess funds that remain will be held pending a future claim.
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- Inspectors, auditors or other people authorized by TRA, conduct inspections of holders to ensure compliance with the Act. An inspector may enter the premises of a holder at reasonable times and require the holder to produce records. He/she may also inspect the operations relevant to the determination of abandoned property. The inspector may copy or remove any records required for more review, and return the original records within a reasonable time.
- A judge may issue a warrant to allow an inspector to enter and search any business premises or other property.
- Any person other than a corporation found guilty of an offence under this Act may be fined up to $2,500. A corporation may be liable to a fine of up to $25,000.