CRA will apply s. 15(2) only to the original loan where it was repaid and relent

Notwithstanding a gap in the wording of s. 15(2.11), CRA considers that where a pre-March 29, 2012 loan is repaid and the same amount is relent as part of the series of transactions that included that repayment, the new loan does not qualify for a "PLOI" election under s. 15(2.11) (see also 2013-0482991E5). However, by the same token, there will be no imputation of interest under s. 17.1 on the new loan, and (to avoid double taxation) s. 15(2) (and thus Part XIII withholding in the case of a non-resident creditor) will only apply to the old loan and not the new loan.

Neal Armstrong. Summary of 2 October 2014 T.I. 2013-0506551E5 under s. 15(2.11).