CRA indicates that it will accept that an election is filed with a return even if the return is filed late
16 June 2022 - 10:59pm
An alter ego trust can effectively elect under s. 104(4)(a)(ii.1) to have the 21-year deemed disposition rule apply, rather than having the deemed disposition occur upon the death of the taxpayer who created the trust. CRA indicated, given that this provision requires that the election be made in the trust’s “return of income … for its first taxation year,” that it will accept an election filed under s. 104(4)(a)(ii.1) only if it is made in the trust’s return of income filed for its first taxation year - regardless of whether that return is filed on time or late.
Neal Armstrong. Summary of 15 June 2022 STEP Roundtable, Q.2 under s. 104(4)(a)(ii.1).