Principales Questions: Would the CRA be prepared, on an administrative basis, to consider that subsection 247(7) is applicable to amounts owing by a foreign affiliate to a partnership, every member of which is a corporation resident in Canada, where all of the other conditions in subsection 247(7) are otherwise met?
Position Adoptée: No.
Raisons: As a baseline for adopting an administrative position, the CRA must be satisfied that doing so would align with the policy underlying the particular provision. It is not clear that this is the case in respect of this request. Furthermore, it would not be appropriate to take a position that disregards Parliament’s decision to limit the application of subsection 247(7) to indebtedness owed to a corporation. In this regard, we note that the partnership look through rule in subsection 17(4) was enacted (in 1999) concurrent with the introduction of subsection 17(8) and the amendment to subsection 247(7) to refer to subsection 17(8).
