CRA indicates that U.S.-dividend income attributed under s. 75(2) does not generate FTCs for the related withholding tax

CRA noted that the attribution of foreign source income (e.g., U.S. dividend income) of a trust (e.g., an alter ego trust) to the settlor under s. 75(2) does not entail the attribution of the non-business taxes (i.e., withholding taxes) thereon so that the settlor cannot claim a foreign tax credit. However, the trust itself may be able to claim a s. 20(11) or (12) deduction in calculating the income that is attributed to the settlor.

Neal Armstrong. Summary of 29 May 2018 STEP Roundtable, Q.13 under s. 126(1).