Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.
Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the Department.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle du ministère.
Revenue Canada Round Table
Canadian Petroleum Tax Society Conference
June, 1994
Question No. 11
SUCCESSOR RULES
A person acquires control of Company A thereby causing Company A's resource pools to be successored. Subsequently, Company A transfers all its resource properties to a partnership electing under subsection 97(2) of the Act at a nominal amount.
Will Company A's proportionate share of production revenue applicable to it by the partnership be considered to be income under, for example, clause 66.7(3)(b)(i)(C) of the Act which is eligible for successor pool deductions?
Department's Position
Company A's proportionate share of the partnership's production revenue from a particular transferred resource property would be considered as income attributable to production from that particular property for the purpose of clause 66.7(3)(b)(i)(C) and subclauses 66.7(4)(b)(i)(A)(II) and (5)(b)(i)(A)(II) of the Act. However, in a situation wherein immediately before the change in control of Company A, it had an interest in a partnership in which the underlying assets included a resource property, paragraph 66.7(10)(j) of the Act would apply to Company A in respect of such resource property.
Author: Bruce Rankin
File: 941031
Date: May 17, 1994
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