CRA finds that recording cross-currency swaps on the Security rather than Inventory line of a s. 85(1) election form did not invalidate the election

CRA found that cross-currency swaps with accrued gains, which for redacted reasons were considered to be held on income rather than capital account, qualified as "inventory" under the broad s. 248(1) definition, so that they could be transferred on a rollover basis into subsidiaries under s. 85(1). Including the swaps on the line of the T2057 Schedule for Securities or debt obligations, rather than on the Inventory line, was a merely "clerical" error which did not invalidate the election.

Neal Armstrong. Summaries of 29 January 2015 Memo 2014-0544651I7 under s. 85(1.1) and s. 85(1).