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ARTICLE · 29 NOVEMBER 2012

Bill C-48, Technical Tax Amendments Act – Amendments To Foreign Affiliate Rules

Blake, Cassels & Graydon LLP
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The rules in the Income Tax Act (Canada) (the ITA) that govern the taxation of income earned by foreign affiliates (FAs) – generally a non-resident corporation in which the Canadian taxpayer has at least a 10% equity interest – have been the subject of numerous proposed amendments over the last decade.

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Blake, Cassels & Graydon LLP
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The rules in the Income Tax Act (Canada) (the ITA) that govern the taxation of income earned by foreign affiliates (FAs) – generally a non-resident corporation in which the Canadian taxpayer has at least a 10% equity interest – have been the subject of numerous proposed amendments over the last decade.

The 945-page Notice of Ways and Means Motion introduced by the Canadian Minister of Finance on October 24, 2012 and tabled in the House of Commons on November 21, 2012 as Bill C-48, the Technical Tax Amendments Act, 2012 (the October 24 Proposals) includes most of the previously announced proposed amendments to the FA rules, including the measures announced in the August 19, 2011 draft legislation (the 2011 Proposals) and the December 18, 2009 draft legislation (the 2009 Proposals), as modified by the August 27, 2010 draft legislation (the 2010 Proposals). For a discussion of the 2011 Proposals, see our August 2011 Blakes Bulletin and for a discussion of the 2009

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