| 920115 | |
| 24(1) | H. Woolley |
| (613) 957-2139 |
19(1)
February 17, 1992
Dear Sirs:
Re: Definition of "Fiscal Period"
This is in reply to your letter of December 24, 1991 in which you requested our interpretation of the definition of "fiscal period" in subsection 248(1) of the Income Tax Act (the "Act"). Specifically, you inquire whether a corporation's first fiscal period may extend beyond one year as long as it does not exceed 53 weeks. As an example, you site a corporation, incorporated on November 28, 1991, that would select its first fiscal period to end on November 30, 1992, with all subsequent fiscal periods of the corporation ending on November 30.
Our Comments
A corporation is required to file a corporate income tax return (T2) for its first fiscal period ending at a time that the accounts of the corporation are ordinarily made up and such period may not exceed 53 weeks (371 days).
If a corporation's accounts will ordinarily be made up on November 30 of each year and the corporation is incorporated on November 28, 1991, it would have the option of selecting either November 30, 1991 or November 30, 1992 as its first fiscal period. All subsequent fiscal periods of the corporation would also end on November 30, unless the Minister of National Revenue agreed to allow a change in the fiscal period.
We trust our comments are of assistance.
Yours truly,
E. Wheelerfor DirectorBusiness and General DivisionRulings DirectorateLegislative and Intergovernmental Affairs Branch