Canadian Oil Sands Trust

Canadian Oil Sands Trust

February 22, 2010 17:43 ET

Canadian Oil Sands Trust Provides Tax Information for 2009 Distributions

CALGARY, ALBERTA--(Marketwire - Feb. 22, 2010) - Canadian Oil Sands Trust (the "Trust") (TSX:COS.UN) today reported the tax information for the cash distributions declared and paid in 2009 to Unitholders resident in Canada and the United States ("U.S.").

The following information is provided for general information only and should not be considered tax or legal advice to any particular existing or potential holder of Trust units. Unitholders are strongly encouraged to consult their tax advisors with respect to their particular circumstances.

Tax information for Unitholders resident in Canada

The following information is based on the Trust's understanding of the Income Tax Act (Canada) and regulations thereunder.

No amounts are required to be reported for tax purposes in respect of cash distributions on the Trust's Units received in 2009 by a Registered Retirement Savings Plan, Registered Pension Plan, Registered Retirement Income Fund or Deferred Profit Sharing Plan or any other such registered plans ("Deferred Plans"). For cash distributions received by a Canadian resident individual outside of a Deferred Plan, 99.991 per cent of the payments are taxable as income.

The following table outlines the breakdown of cash distributions per Unit paid by the Trust with respect to record dates for the year ended December 31, 2009.

Cdn$ Total Amount Per Cdn$ Tax Deferred
Cash Unit Amount Per Unit
Distribution (99.991 (0.009
Record Date Payment Date Per Unit per cent) per cent)
Feb. 9, 2009 Feb. 27, 2009 0.15 0.14999 0.00001
May 11, 2009 May 29, 2009 0.15 0.14999 0.00001
Aug. 17, 2009 Aug. 28, 2009 0.25 0.24998 0.00002
Nov. 20, 2009 Nov. 30, 2009 0.35 0.34997 0.00003
Total 0.90 0.89993 0.00007

T3 Statement of Trust Income Allocations and Designations forms are expected to be mailed to the Trust's Unitholders on or before March 31, 2010 by your financial institution if the Units are held in non-registered or nominee form, or by Computershare if the Units are held in registered form.

Tax information for Unitholders resident in the U.S.

Canadian Oil Sands believes that the distributions paid in the 2009 calendar year are considered foreign-source dividend income under U.S. federal income tax principles. Providing that applicable holder-level requirements are met, these distributions are "qualified dividends" eligible for taxation at reduced rates under U.S. federal income tax legislation; however, Canadian Oil Sands has not received an IRS letter ruling or tax opinion from its tax advisors on these matters, and the individual taxpayer's situation must be considered before making this determination.

Generally, distributions payable to non-residents of Canada are normally subject to a withholding tax of 25 per cent as prescribed by the Income Tax Act (Canada); however, the withholding tax for residents of the U.S. is prescribed at 15 per cent in accordance with a reciprocal tax treaty between the U.S. and Canada. U.S. taxpayers may be eligible for a foreign tax credit with respect to the Canadian withholding taxes paid. Other jurisdictions may also have reciprocal tax treaties that would reduce the withholding tax rate.

A Canadian NR4 (non-resident) supplemental form detailing the Canadian tax withheld and remitted to the Canadian government will be mailed to the Trust's non-resident Unitholders by your financial institution if the Units are held in non-registered or nominee form, or by Computershare if the Units are held in registered form.

The following table provides the breakdown of the amount of cash distribution, prior to the Canadian withholding tax, paid by the Trust in 2009.

US$/Cdn$ Per cent of
Currency Distribution
Exchange US$ Return of
Cdn$ Rate on Equivalent Per cent of Capital/
Record Payment Distribution Payment Distribution Distribution Capital
Date Date Per Unit Date Per Unit Taxable Gain
Feb. 9, Feb. 27,
2009 2009 0.15 0.7870 0.11805 89.42 10.58
May 11, May 29,
2009 2009 0.15 0.9123 0.13685 89.42 10.58
Aug. 17, Aug. 28,
2009 2009 0.25 0.9192 0.22980 89.42 10.58
Nov. 20, Nov. 30,
2009 2009 0.35 0.9457 0.33100 89.42 10.58
Total 0.90 0.81570 89.42 10.58

It is possible that the U.S. dollar amount was different for non-registered, or beneficial Unitholders receiving their payment from an intermediary or brokerage firm using different exchange rates.

For any questions regarding the supplemental tax forms, please contact your financial institution if your Units are held in non-registered form. If your Units are held in registered form, contact the Trustee and Transfer Agent, Computershare Trust Company of Canada, at 1-800-564-6253. For all other inquiries, please contact the Trust.

Further information on distributions paid by the Trust, including a tax summary of distributions paid since inception, is available on the Trust's Web site at under Investor/Distributions.

Canadian Oil Sands Trust provides a pure investment opportunity in the Syncrude Project through its 36.74 per cent working interest. Located near Fort McMurray, Alberta, Syncrude operates large oil-sands mines and an upgrading facility that produces a high-quality, sweet crude oil. The Trust is an open-ended investment trust managed by Canadian Oil Sands Limited and has approximately 484.4 million units outstanding, trading on the Toronto Stock Exchange under the symbol COS.UN.

Canadian Oil Sands Limited

Marcel Coutu

President & Chief Executive Officer

Units Listed - Symbol: COS.UN

Toronto Stock Exchange

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