Last year, Parliament introduced Bill C-48 (the “Bill”), one of the most significant omnibus tax bills ever put before the legislature. Spanning more than 900 pages, the Bill was introduced to enact the substantial backlog of proposed amendments to the Income Tax Act (Canada) (the “Act”) that have accumulated over the past decade or so. On June 26, 2013, the Bill received royal assent and was passed into law.
The amendments contained in the Bill are sweeping and affect hundreds of different provisions contained in the Act and the regulations thereto. Some of the more significant provisions affected include those related to:
• Non-resident trusts
• Offshore investment fund property
• Foreign affiliates
• Foreign tax credit generators
• Reporting of tax avoidance transactions
• Contingent expenses
• Share and option consideration for goods or services
• Restrictive covenants
• Charitable organizations
• Real Estate Investment Trusts (REITs)
Many of these amendments apply retroactively and, in some cases, transitional relief is available.
The Bill’s passage is welcome news for taxpayers and advisors alike, as it significantly reduces the need to rely on legislative proposals when engaging in tax planning. However, owing to the sheer volume of change and retroactive application, it is important to review the Bill for any impact that it may have on your tax affairs. Should you have any questions regarding the Bill or its effect on you or your business, we would be pleased to assist.