Unpaid fees owing by Canco to FA potentially may give rise to a double income-inclusion to Canco

If Canco owes fees to FA, there potentially could be a double income inclusion to Canco (albeit, in different years) under ss. 90(6) and 78(1). The double inclusion might be addressed by filing a s. 78(1)(b) agreement. "However, it is not clear whether and how subsection 90(6) will apply to the loan that is then deemed to be made to the taxpayer (Canco) by the creditor (FA) on the first day of the taxpayer's third taxation year."

Neal Armstrong. Summary of Clara Pham, "An Unpaid Amount Could Be an Upstream Loan", Canadian Tax Focus, Vol. 5, No. 3, August 2015, p.5 under s. 90(6).