CRA applies Gerbro in interpreting s. 94.1

After referring to earlier positions and Gerbro as to the meaning of "portfolio investment" in s. 91.1(1)(b), CRA stated:

[T]he term “portfolio investment” must be given a broad meaning and is not limited to passive investments. In paragraph 94.1(1)(b), the word “portfolio” modifies the word “investment” to specify that the investment in particular assets by the investor is one in which the investor does not have an active role in the management of the item invested in.

CRA also noted that tax attributes to the taxpayer, such as interest deductions, foreign tax credits, or a loss pool, would not necessarily preclude the application of s. 94.1(1) based the “one of the main reasons” test.

Neal Armstrong. Summary of 24 August 2023 Internal T.I. 2019-0810391I7 under s. 94.1(1).