Box O – Patronage Dividends (Code: RL)
The total amount of patronage dividends paid during the year must be entered in box O of the RL-1 slip (see courtesy translation RL-1-T) if that amount is more than $100.
The total amount of patronage dividends paid to a member of a qualified cooperative in the form of preferred shares must be entered in box O of the member's RL-1 slip.
You must also enter “O-2” in a blank box, followed by the amount of the deduction for patronage dividends.
If the patronage dividends are paid to a partnership, the qualified cooperative must issue an RL-1 slip in the name of the partnership rather than in the name of each member of the partnership. No social insurance number (SIN) should be entered on the slip.
The partnership must file an RL-15 slip for each of its members so that they can claim the deduction for patronage dividends.
For more information, refer to the Guide to Filing the RL-15 Slip: Amounts Allocated to the Members of a Partnership (RL-15.G-V).
A patronage dividend in respect of property or services is not taxable if the taxpayer is unable to deduct the cost of the property or services in the calculation of business or property income.
Where a cooperative redeems a preferred share that was previously issued as a qualified patronage dividend, enter “O-3” in a blank box of the member's RL-1 slip, followed by the preferred share's redemption amount.
You must indicate the source of this income by entering code RL in the box marked “Code (case O)” of the RL-1 slip.
For more information on the codes to enter in the box marked “Code (case O),” consult RL-1 Slip – Box Marked “Code (case O)”.