18 April 2023 Internal T.I. 2020-0864031I7 - Application of subparagraph 95(2)(a)(i) -- summary under Clause 95(2)(b)(i)(B)

The Directorate indicated that if s. 95(2)(a)(i) applied to deem the income from a loan activity of a CFA (FA5 Subco) to be active business income, services fees paid by FA5 Subco to another CFA (FA4) would thus be deductible from such deemed active business income of FA5 Subco rather than from foreign accrual property income, so that s. 95(2)(b)(i)(B) would not apply to deem such services fees to be FAPI to FA4.