Canadian Oil Sands Trust provides tax information for 2007 distributions



    CALGARY, Feb. 29 /CNW/ - (TSX -- COS.UN) - Canadian Oil Sands Trust (the
"Trust") today reported the tax information for the cash distributions
declared and paid in 2007 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 received 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, about 99 per cent of the payments are taxable as income. The remaining
one per cent is a tax-deferred "return of capital", which should be deducted
from the adjusted cost base of a holder's units in the Trust.
    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,
2007.

    
    -------------------------------------------------------------------------
                                                                    Cdn$ Tax
                                                     Cdn$ Taxable   Deferred
                                      Cdn$           Amount Per     Amount
                                      Total Cash     Unit           Per Unit
                                      Distribution   (99.16         (0.84
    Record Date      Payment Date     Per Unit       per cent)      per cent)
    -------------------------------------------------------------------------
    Nov. 16, 2007    Nov. 30, 2007    0.55           0.54538        0.00462
    Aug. 7, 2007     Aug. 31, 2007    0.40           0.39664        0.00336
    May 8, 2007      May 31, 2007     0.40           0.39664        0.00336
    Feb. 8, 2007     Feb. 28, 2007    0.30           0.29748        0.00252
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Total                             1.65           1.63614        0.01386
    -------------------------------------------------------------------------
    

    T3 Statement of Trust Income Allocations and Designations forms are
expected to be mailed to the Trust's Unitholders on or before March 31, 2007
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 2007
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
Canada and the U.S.. 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
2007.

    
    -------------------------------------------------------------------------
                                                                    Per cent
                                                                          of
                                          Cdn$/                       Distri-
                                          US$      US$       Per      bution
                                          Currency Equi-     cent     Return
                                Cdn$      Exchange valent    of           of
                                Distri-   Rate on  Distri-   Distri- Capital/
    Record             Payment  bution    Payment  bution    bution  Capital
    Date               Date     Per Unit  Date     Per Unit  Taxable    Gain
    -------------------------------------------------------------------------
    Nov. 16, 2007   Nov. 30, 2007  0.55    0.9992    0.5496   94.63    5.37
    Aug. 7, 2007    Aug. 31, 2007  0.40    0.9466    0.3786   94.63    5.37
    May 8, 2007     May 31, 2007   0.40    0.9347    0.3739   94.63    5.37
    Feb. 8, 2007    Feb. 28, 2007  0.30    0.8547    0.2564   94.63    5.37
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Total                          1.65                       94.63    5.37
    -------------------------------------------------------------------------
    

    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 more information

    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 www.cos-trust.com under investor information, 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 479.4 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





For further information:

For further information: Siren Fisekci, Director, Investor Relations:
(403) 218-6228, investor_relations@cos-trust.com, Web site: www.cos-trust.com

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CANADIAN OIL SANDS TRUST

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