31 October 2017 External T.I. 2017-0690691E5 F - New section 15 back to back loan rules -- summary under Specified Right

A 50% shareholder of Corporation B (Ms. B) received a $3M bank loan that was secured by a pledge to the bank of a $3M term deposit held by Corporation B). After finding that s. 15(2.6)(c)(i)(B) applied to deem there to be a $3M loan from Corporation B to Ms. B (on the basis, e.g., that the $3M loan was permitted to remain outstanding because the term deposit was outstanding), CRA went on to state:

[I]t appears possible to us that a term deposit given as a security could represent property that comes within the definition of specified right for the purposes of subparagraph 15(2.16)(c)(ii).

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d7 import status
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