Income Tax Severed Letters - 2026-04-22

Ruling

2025 Ruling 2024-1011001R3 - Double wing Split-Up Butterfly

Unedited CRA Tags
55(2), 55(3)(b), 88(1), 84(3), 85(1)

Principal Issues: Whether the butterfly dividend is exempt from 55(2) as a result of qualifying under 55(3)(b)?

Position: Yes.

Reasons: Proposed transactions meet the requirements of paragraph 55(3)(b).

Technical Interpretation - External

23 September 2025 External T.I. 2025-1064831E5 - "Specified foreign property" under ss. 233.3(1)

Unedited CRA Tags
Subsections 233.3(1) and (3) of the Income Tax Act
Summary Under
Tax Topics - Income Tax Act - Section 233.3 - Subsection 233.3(1) - Specified Foreign Property - Paragraph (h)
electronic certificates representing an undivided interest in unallocated precious metals constituted an interest in tangible property under para. (h)

Principal Issues: 1. Whether precious metals held by an individual resident in Canada through a Canadian corporation and stored in a vault situated outside Canada constitute "specified foreign property" as defined in subsection 233.3(1). 2. Whether the individual is required to file Form T1135 to disclose the precious metals holding.

Position: 1. Factual determination, but likely yes. 2. Yes, if the total cost of the "specified foreign property" to the "specified Canadian entity" exceeds $100,000.

Reasons: 1. Precious metals owned by the particular individual and stored in a vault situated outside Canada may constitute "specified foreign property" pursuant to paragraph (b) or (h) of the definition in subsection 233.3(1). 2. In the situation where a "specified Canadian entity" owns "specified foreign property" and the cost amount of the “specified foreign property” to the entity exceeds $100,000, the entity would be required to file Form T1135 in relation to the foreign property under subsection 233.3(3).

22 July 2024 External T.I. 2023-0995501E5 - Mineral Resource Certificate XXXXXXXXXX

Unedited CRA Tags
Definition of "mineral resource" in subsection 248(1)

Principal Issues: Whether NRCan can certify that the principal mineral to be extracted from the lithium-bearing spodumene deposits will be a principal mineral extracted from a non-bedded deposit.

Position: Yes.

Reasons: Positive Opinion provided by NRCan.

Technical Interpretation - Internal

10 February 2023 Internal T.I. 2019-0816681I7 - “Fresh start” rules

Unedited CRA Tags
95(2)(k) and (k.1), Reg. 5907(2.9)
Summary Under
Tax Topics - Income Tax Act - Section 95 - Subsection 95(2) - Paragraph 95(2)(k)
the fresh-start rule re a change of an active to an investment business is inapplicable where there also is a “fundamental change” to that business

Principal Issues: Whether “fresh start” rules applied on the facts at issue and the consequences of their application.

Position: The “fresh start” rules did not apply on the business restructuring.

Reasons: The requirements in paragraph 95(2)(k) were not satisfied because the foreign affiliate commenced carrying on a new business when the business model changed.