CRA considers that an exempt low-rental housing corp can use a CDA

CRA considers that one-half of the capital gains generated by a private corporation that is exempt as a low-rental housing corporation under s. 149(1)(n) are added to its capital dividend account and can be paid out as capital dividends.

However, should it lose its exempt status, it also would lose its CDA under s. 89(1.2) – and the timing of the capital gains arising to it under the s. 149(10) disposition of its property would preclude those gains from being added to the available amount of its CDA.

Neal Armstrong. Summaries of 17 August 2016 Internal T.I. 2016-0639251I7 under s. 89(1) – capital dividend account - (a) and s. 89(1.2).