CRA provides example of deduction of loss deduction under s. 88(1.1) being postponed until year in which sub is dissolved

CRA has provided a simple example of the proposition that a Canadian parent generally may deduct a loss of a subsidiary that has been wound up in any taxation year of the parent commencing after the winding-up.

The subsidiary, which has losses for its taxation years ending on June 30, 2013 and June 30, 2014, commences its winding-up on June 15, 2014 and is dissolved in October 2015. The parent can deduct those losses only in its 2015 calendar taxation year, and not in its 2014 year, as 2015 is the year of the dissolution.

Neal Armstrong. Summary of 2015-0618211E5 under s. 88(1.1).