Foreign spin-offs – Extension under the taxpayer relief provisions
The Income Tax Regulations extend the application of the taxpayer relief provisions to the election that allows a tax deferral of eligible distributions of foreign spin-off shares. Among other things, the taxpayer relief provisions give the Minister of National Revenue and their delegated officials discretion to allow late and amended elections, or to revoke them. An application must be made within ten years of the end of the tax year to which the election relates.
Section 600 of the Regulations includes paragraph 86.1(2)(f) in the list of elections set out in paragraph 600(c). This means that the Minister of National Revenue may, under the taxpayer relief provisions of subsection 220(3.2) of the Income Tax Act, extend the time for making the election for a tax deferral of eligible distributions of foreign spin-off shares.