CRA confirms that interest on borrowing funding a normal course issuer bid is deductible subject to the usual accumulated profits and stated capital test

The CRA position in S3-F6-C1, para. 1.48 - that interest generally is deductible on money borrowed to redeem shares to the extent of accumulated profits and of stated capital of the redeemed shares - also applies to open market purchases-for-cancellation of common shares. CRA also reiterated that this general position is referring to corporate stated (or paid-up) capital.

Neal Armstrong. Summary of 2015-0621401I7 under s. 20(1)(c).