The tax deferral rules are to be amended in Canada’s corporate partnership to extend the time available to companies to file an alignment election. According to the existing regime corporate partners can choose the fiscal period of their partnership either with the taxation year of one of their corporate partners or, in the case of a tiered-partnership structure, to a common fiscal period for all partnerships in the structure.
According to the Keeping Canada’s Economy and Jobs Growing Act some corporate partners had to file the election as early as September 23, 2011. Instead of that under the current plans late alignment elections will be filed on or before January 31, 2012. Furthermore, the Income Tax Act will be amended and clarified to refer to the year “2012” rather than “2011”.
