Type of corporation
Canadian-controlled private corporation (CCPC)
The corporation is a CCPC if it meets all of the following requirements at the end of the tax year:
- it is a private corporation
- it is a corporation that was resident in Canada and was either incorporated in Canada or resident in Canada from June 18, 1971, to the end of the tax year
- it is not controlled directly or indirectly by one or more non-resident persons
- it is not controlled directly or indirectly by one or more public corporations (other than a prescribed venture capital corporation, as defined in Regulation 6700 of the Income Tax Regulations)
- it is not controlled by a Canadian resident corporation that lists its shares on a designated stock exchange outside of Canada
- it is not controlled directly or indirectly by any combination of persons described in the three previous conditions
- if all of its shares that are owned by a non-resident person, by a public corporation (other than a prescribed venture capital corporation), or by a corporation with a class of shares listed on a designated stock exchange were owned by one person, that person would not own sufficient shares to control the corporation
- no class of its shares of capital stock is listed on a designated stock exchange
Note
A CCPC that has elected under subsection 89(11) not to be a CCPC for certain purposes should tick box 1 when filling line 040.
Other private corporation
The corporation is an other private corporation if it meets all of the following requirements at the end of the tax year:
- it is resident in Canada
- it is not a public corporation
- it is not controlled by one or more public corporations (other than a prescribed venture capital corporation, as defined in Regulation 6700 of the Income Tax Regulations)
- it is not controlled by one or more prescribed federal Crown corporations (as defined in Regulation 7100)
- it is not controlled by any combination of corporations described in the two previous conditions
Public corporation
The corporation is a public corporation if it is resident in Canada and meets either of the following requirements at the end of the tax year:
- it has a class of shares listed on a designated Canadian stock exchange
- it has elected, or the minister of National Revenue has designated it, to be a public corporation and the corporation has complied with prescribed conditions under Regulation 4800(1) of the Income Tax Regulations on the number of its shareholders, the dispersing of the ownership of its shares, the public trading of its shares, and the size of the corporation
If a public corporation has complied with certain prescribed conditions under Regulation 4800(2), it can elect, or the minister of National Revenue can designate it, not to be a public corporation.
Corporation controlled by a public corporation
The corporation is a corporation controlled by a public corporation if it is a Canadian subsidiary of a public corporation. This type of corporation does not qualify as a public corporation for the purpose of determining the type of corporation when completing your T2 Corporation Income Tax Return.
Other corporation
The corporation is an other corporation if it does not fall within the other categories.
Examples of other corporations include general insurers and Crown corporations.
Note
Credit unions and cooperative corporations should tick box 1 at line 040 when preparing their T2 return if they meet the definition of a Canadian-controlled private corporation under subsection 125(7) (without reference to subsections 137(7) or 136(1) respectively).