CRA indicates that a s. 83(2) dividend election cannot be made on a formula amount

Immediately prior to closing a sale of a private corporation, its shareholder wishes to have all of the capital dividend account distributed to it, but the precise CDA balance cannot be known until year end when the accounts are finalized. Would CRA accept a resolution of the directors and a T2054 form where the amount of the capital dividend was shown only by a mathematical formula, i.e., it would be, at the time of signing, a determinable, but not a determined, amount?

CRA responded, “no,” a precise dollar amount was required to be specified, before going on to note that the maximum late-filing penalty was only $41.67 per month.

Neal Armstrong. Summary of 7 October 2020 APFF Roundtable Q. 9, 2020-0852211C6 F under s. 83(2).