I-3 - Taxation Act

Section 571 Disposition versions

2006-03-01

571. In this Title, “foreign affiliate”, at a particular time, of a taxpayer resident in Canada means a corporation not resident in Canada in which, at that time,

(a)  the taxpayer’s equity percentage is not less than 1%, and

(b)  the total of the equity percentages in the corporation of the taxpayer and of each person related to the taxpayer, where each such equity percentage is determined as if the determinations, in applying the rule provided in subparagraph b of the first paragraph of section 573, were made without reference to the equity percentage of any person in the taxpayer or in any person related to the taxpayer, is not less than 10%.

However, no corporation may be a foreign affiliate of a non-resident-owned investment corporation.

1972, c. 23, s. 442; 1973, c. 17, s. 66; 1975, c. 22, s. 149; 1996, c. 39, s. 161; 1997, c. 3, s. 71.