Jocelyn Arnason has authored an article titled “Proposed Amendments to Paragraph 87(2)(II)” published by Federated Press in TaxNet Pro’s Corporate Structures and Groups newsletter.
Writes Jocelyn: “Draft legislation released on August 12, 2024, includes a proposal to amend the Income Tax Act (Canada) to introduce an exception to the deeming rule on paragraph 87(2)(ii) that applies to an amalgamation of two or more corporations where any predecessor corporation was a “public corporation” immediately before the amalgamation. This article summarizes the ways in which the Income Tax Act (Canada) distinguishes between private and public corporations, reviews the proposed amendments to paragraph 87(2)(ii), and discusses the particular timing trap that such amendments are intended to address, which may arise in certain acquisition transactions where a private corporation acquires a public corporation and the corporations amalgamate immediately after closing, but prior to the formal delisting of the purchased shares.”
TaxNet Pro’s Corporate Structures and Groups newsletter is a journal devoted to the tax aspects of structuring and restructuring corporations and other business entities.
Read the full article here. (Subscription required.)