CRA confirms its interpretation of the 60-day rule in IT-378R

In response to a description of some addled transactions, CRA confirmed:

• although a partnership (in this case, a Quebec partnership) "would generally cease to exist if there are no longer at least two partners carrying on the business," s. 98(1) would deem the partnership to have not ceased to exist until all partnership property had been distributed; and
• it still stands by the statement in IT-378R (Archived), para. 7, respecting the requirement that "the affairs of the partnership were wound up within 60 days after the disposition" of its property to the corporation, that it will consider "the affairs of a partnership to have been wound up when all the property of the partnership…has been distributed to the members in satisfaction of their interests in the partnership" – so that it shouldn’t matter if formal dissolution of the partnership occurs beyond the 60-day period.

Neal Armstrong. Summaries of 8 May 2014 T.I. 2014-0522771E5 under s. 85(3) and s. 98(1).