CRA reverses its position that s. 84.1(1)(b) dividends do not generate dividend refunds

In 2002-0128955, CRA indicated that a deemed dividend under s. 84.1(1)(b) would not generate a dividend refund (DR). CRA has now stated:

[W]e have come to the conclusion that the position described in the Interpretation no longer represents the position of the CRA. In particular, according a DR to a corporation deemed to have paid a dividend by virtue of paragraph 84.1(1)(b) provides in our view a result that is more compatible with the integration principle enshrined in the Income Tax Act.

Neal Armstrong. Summary of 11 October 2019 APFF Roundtable, Q.1 under s. 129(1).