CRA considers that ETA s. 186(1) does not help a parent to qualify for a s.156 election

CRA considers that ETA s. 186(1), which permits input tax credits to be claimed by a registered holding company on expenses incurred for use in relation to shares or indebtedness of a related corporation (e.g., a sub) engaged exclusively in commercial activity, applies “only for the purpose of ITC calculations” and does not have the effect of deeming the holding company to be engaged in commercial activity – so that it would generally not qualify for the purposes of making a s. 156 election with the sub so as to avoid having to charge GST on management fees.

Neal Armstrong. Summary of 2015 CBA Roundtable, Q.21 under ETA s. 186(1), s. 156(1) – qualifying member.