Joint Committee, "Summary of Issues Raised with the Department of Finance in Respect of the Excessive Interest and Financing Expenses Limitation (EIFEL) Proposals", 22 March 2023 Joint Committee letter

Summary Under
Tax Topics - Income Tax Act - Section 18.2 - Subsection 18.2(1) - Relevant Affiliate Interest And Financing Expenses

No RAIFE carve-out for ss. 95(2)(a) and 95(2)(a)(ii)(D) amounts (p. 14)

  • A controlled foreign affiliate’s interest and financing expenses...

The text of this content is paywalled except for the first five days of each month. Subscribe or log in for unrestricted access.

Summary Under
Tax Topics - Income Tax Act - Section 95 - Subsection 95(2) - Paragraph 95(2)(f.11) - Subparagraph 95(2)(f.11)(ii) - Clause 95(2)(f.11)(ii)(A)

Interpretive difficulties re lower-tier LP structures (p. 17)

  • It is unclear how the EIFEL rules apply where a partnership (“LP”) is...

The text of this content is paywalled except for the first five days of each month. Subscribe or log in for unrestricted access.

Summary Under
Tax Topics - Income Tax Act - Section 18.2 - Subsection 18.2(1) - Relevant Affiliate Interest And Financing Revenues

Inappropriate reduction of RAIFR for s. 91(4) deduction for Canadian withholding tax

  • It is inappropriate to reduce the relevant affiliate...

The text of this content is paywalled except for the first five days of each month. Subscribe or log in for unrestricted access.

Summary Under
Tax Topics - Income Tax Act - Section 18.2 - Subsection 18.2(1) - Eligible Group Entity - Paragraph (a)

Relatedness by virtue of sibling status (p. 3)

  • As siblings may (and often will) have limited knowledge of each other’s business affairs, they...

The text of this content is paywalled except for the first five days of each month. Subscribe or log in for unrestricted access.

Summary Under
Tax Topics - Income Tax Act - Section 18.2 - Subsection 18.2(1) - Excluded Entity - Paragraph (c) - Subparagraph (c)(iii)

Arbitrary nature of the (c)(iii) tests (pp. 4-5)

  • The s. (c)(iii) requirements for the “domestic” exception can cause an entity to qualify or...

The text of this content is paywalled except for the first five days of each month. Subscribe or log in for unrestricted access.

Summary Under
Tax Topics - Income Tax Act - Section 18.2 - Subsection 18.2(1) - Adjusted Taxable Income - A - D - Paragraph D(a)

A(D)(a) should be permitted to be a negative number (p. 7)

  • In order to permit the carry back or carry forward of losses sufficient to fully...

The text of this content is paywalled except for the first five days of each month. Subscribe or log in for unrestricted access.