Information for foreign corporations

Foreign corporations have to file certain information with the Canada Revenue Agency (CRA) so that its Canadian shareholders can elect under section 86.1 for the spin-off dividend.

Requirements for U.S. corporations

U.S. corporations have to provide all of the following information and documentation:

The CRA will be able to review the submission more quickly if a copy of the information package mailed to shareholders announcing and/or describing the distribution is provided with the above information.

If the shares distributed in the course of the spin-off had rights to purchase other shares attached to them, the corporation should do all of the following:

Requirements for non-U.S. corporations

Non-U.S. corporations have to file the same information as U.S. corporations, with the following changes:

Furthermore, for non-U.S. spin-offs, the distribution is also subject to other terms and conditions that are prescribed by the Department of Finance. If a non-U.S. spin-off meets all of the other conditions, the CRA will request that the Department of Finance consider it for prescription.

Consent to publish approved spin-offs

If the spin-off is approved, you may want to make it public on the CRA website to reduce the corporation's workload on informing Canadian shareholders.

To make the approved spin-off public on the CRA website, we need a written consent signed by an officer of the corporation. You may use the following text:

"I, (name and title), on behalf of (name of corporation), consent to the Canada Revenue Agency (CRA) publishing that the spin-off of (name of the other corporation) has been approved on (date of spin-off) for the purposes of section 86.1 of the Income Tax Act."

Send your documentation and consent letter to the following address:

Canada Revenue Agency
Central and Southern Quebec Tax Services Office
International Tax, Division 447
3250 boulevard Lapinière, 3rd Floor
Brossard QC  J4Z 3T8

The CRA has to receive this information before the end of the sixth month following the day of distribution. This deadline cannot be extended.

Notice to the reader

Canadian shareholders who want to elect under section 86.1 for the spin-off dividend must include a letter with their income tax return or send it to their tax centre.

See Information for Canadian shareholders.

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