CRA is reconsidering whether a partnership selling shares on an earnout basis can utilize the cost-recovery method

After referring to its adverse conclusion in 2021-0884651E5, CRA stated:

[T]he CRA is prepared to re-examine whether the cost recovery method should apply to Canadian resident taxpayers that are members of partnerships that sell shares subject to an earnout agreement. …

[It]s review … may take some time. Therefore, any change of position would likely be disclosed at a future CRA Round Table, rather than in the context of a technical interpretation.

Neal Armstrong. Summary of 1 February 2024 External T.I. 2023-0994141E5 under s. 12(1)(g).