Reg. 229 does not require a T5013 return to be filed respecting a partnership which does not carry on a business in Canada, and is not a Canadian partnership or SIFT partnership. Thus, a Canadian partner can be a partner of a partnership that has not filed such a return. Pursuant to s. 152(1.4), the Minister may determine the income of a partnership for a fiscal period respecting a partner for the three years following the later of the day on or before which a partner would be required under Reg. 229 to file the return, and the day of such filing.
How does CRA apply the statute-barring rules respecting a Canadian partner of a partnership for which no information return under Reg. 229 was required? CRA responded:
The long-standing position of the CRA is that the Minister cannot make a determination where the partners of the partnership are not required to file a T5013 under ITR section 229, given that the conditions provided for in paragraphs 152(1.4)(a) and (b) cannot then be satisfied.
However, the Minister could instead make an assessment under the general rules in subsection 152(4) of, where applicable, the tax, interest or penalties to be paid by the Canadian partner for its taxation year. Thus, a Canadian partner who did not declare the partner’s share of the partnership's income could, for instance, be considered to have made a misrepresentation that is attributable to neglect, carelessness or wilful default or to have committed a fraud in filing the return, and the Minister could then assess that taxpayer at any time under subparagraph 152(4)(a)(i).