Regulation 229


Anthony V. Strawson, "Should Partnership Information Returns be Filed as a Matter of Course?", Tax for the Owner-Manager, Vol. 9, No. 4, October, 2009, p. 4.

Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 152 - Subsection 152(1.4) 0

Subsection 229(1)

Administrative Policy

31 May 2016 External T.I. 2016-0642011E5 - Functional currency election and partnerships

partnership with functional currency partner must file T5013 return and slips with CRA in the functional currency

ACo and BCo are equal partners in a partnership. ACo has made a functional currency election under s. 261(3). The partnership books and records are kept in both Canadian dollars and the functional currency. what are the reporting obligations of the partnership? CRA responded:

As required by subsection 229(1) of the Regulations, if a foreign currency election is made pursuant to subsection 261(3) of the Act by a corporate partner, the partnership must file a T5013…and related summary and slips in the elected functional currency with the Canada Revenue Agency. … Separate T5013 slips in Canadian dollars must be prepared by the partnership and provided to the non-electing partner(s) but these slips are not to be filed with the Canada Revenue Agency.

90 C.R. - Q32

Where a partner retires from a partnership that has a continuing right to an allocation of income under s. 96(1.1), or has a residual interest under s. 98.1 rather than a continuing income interest, the principle to be applied is that the partnership information return requires the reporting of allocations of income or losses to partners and changes to each partner's capital account.

88 C.R. - "Tax Reform and Tax Administration" - "Partnership Reporting"

Explanation of the need for the regulation.

IC 89-5R "Partnership Information Return"


Robert Cribb, Marco Chown Oved, "Snow washing: Canada is the world’s newest tax haven ", Toronto Star, 25 January 2017

Filing exemption for provincially-formed partnerships which have no Canadian partners or Canadian business

Of greatest interest to foreign investors are Canadian limited partnerships (LPs): a corporate structure that has no tax filing requirements. Only the partners behind an LP have to file taxes, and if they’re not residents of Canada, no taxes are filed here at all.

“Canada is a horrible tax haven. Everybody is now switched over from using BVI companies and Cayman companies to Canadian LPs....” said Mark Morris, an independent tax consultant based in Zurich....

Reporting issue under study by Finance

“Canada is a new player in the world of offshore companies,” claims the website of a Swiss firm. “Canada is the most preferable destination for compliant tax planning since it has no negative offshore reputation and no association with tax avoidance or evasion. It is by far one of the best neutral jurisdictions, providing offshore benefits without any of the traditional offshore drawbacks.”

Federal Finance Minister Bill Morneau says his government sees this as an important issue and that he is working with his provincial colleagues to bring greater transparency to the corporate registration system.

“We as a government, and I personally, am committed to making progress on ensuring that we are not providing any haven for any inappropriate activities and that we’re having companies and individuals paying the share of tax that should be due,” he said in an interview.


T5013 "Statement of Partnership Income"

Subsection 229(4)

Administrative Policy

1 May 1990 T.I. (October 1990 Access Letter, ¶1484)

A partnership formed to pay the expenses incurred by a condominium building with respect to community property, and a "non-profit" partnership formed to acquire and maintain assets of the disposal of the community would not qualify for exemption.

Subsection 229(5)

Administrative Policy

5 October 2018 APFF Roundtable Q. 6, 2018-0768771C6 F - Determination for a foreign partnership

where no T5013 obligation, CRA will assess the partners directly within the s. 152(4) limitations

CRA’s position is that where the partners of a partnership are not required to file a T5013 (which would generally be the case if the partnership does not carry on a business in Canada, and is not a Canadian partnership or SIFT partnership), the CRA cannot make a partnership income or loss determination under s. 152(1.4). Instead, if CRA considers the partnership income or loss reported by a partner to be incorrect, it will assess the partner directly subject to the normal limitations under the general rules in s. 152(4). See also 2078970 Ontario and 2017-0734751I7.

Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 152 - Subsection 152(1.4) CRA cannot make a partnership income or loss determination where the partnership has not T5013 filing obligation 274