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Draft and Recently-enacted Amendments Impact Canadian Outbound Investment Tax Rules

Author(s): Patrick Marley, Drew Morier

Feb 2, 2010

On December 18, 2009, the Canadian Department of Finance (Finance) released a package of proposed foreign affiliate amendments (the 2009 Proposals).  This Update summarizes the impact of these proposals on outbound investment by Canadians, and reviews the status of various other proposed and recently-enacted changes to Canada’s foreign affiliate rules. Finance’s approach to certain proposed amendments in the 2009 Proposals, and in particular its focus on simplification and ease of compliance, holds promise for future amendments.

Navigating the foreign affiliate rules is difficult at the best of times.  The myriad of recent changes, both enacted and proposed, makes it even more difficult.  Osler’s international tax practitioners deal with these rules every day, and are among the nation’s foremost experts.  If you have any questions about how these rules affect you, please contact any member of our Tax Department . 

A more detailed discussion of the 2009 Proposals and a summary of the status of foreign affiliate amendments is available here.