Paying Inter-Corporate Dividends? Proceed with Caution | KPMG | CA

Paying Inter-Corporate Dividends? Proceed with Caution

Paying Inter-Corporate Dividends? Proceed with Caution

May 17, 2016, No. 2016-28. Canadian corporations that receive dividends from other Canadian corporations now have more guidance from the CRA about the potential application of an expanded anti-avoidance rule. Many corporations may be adversely affected by this rule, which recharacterizes certain otherwise tax-free inter-corporate dividends as capital gains that are subject to tax. This expanded rule will apply to dividends received after April 20, 2015.

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Information is current to May 16, 2016. The information contained in this TaxNewsFlash-Canada is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act upon such information without appropriate professional advice after a thorough examination of the particular situation.

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