Where there is an amalgamation of 
two or more corporations and there 
is no acquisition of control of a 
predecessor corporation by virtue of 
the amalgamation, the amalgamated 
corporation can utilize the losses of the 
predecessor corporations as if those 
losses were its own.

Where there is an amalgamation of a 
parent and a wholly owned subsidiary, 
the amalgamated corporation can 
carry back any losses it realizes against 
income of the parent subject to the 
restrictions described below. 

Where a parent corporation winds up a 
subsidiary corporation in accordance with 
the tax-deferral rules, the losses of the 
subsidiary can be applied against income 
of its parent in the taxation year beginning 
after commencement of the wind-up. 

Restrictions apply to the utilization of 
losses of a corporation on an acquisition 
of control of the corporation, whether by 
way of amalgamation or otherwise. 

The rules applying to corporate 
reorganizations, amalgamations, and 
wind-ups are discussed in 

Structuring 

Mining Investments – Corporate 
Reorganizations

.

Tax Administration

The ITA is administered by the Canada 
Revenue Agency (CRA). The CRA has 
powers to conduct audits, require the 
production of tax-related information, 
collect taxes owing, and impose interest 
and penalties on unpaid amounts. 

To assist taxpayers in the application 
of the federal income tax rules and 
regulations, the CRA publishes guidance 
in the form of information circulars, 
interpretation bulletins, technical 
interpretations and periodic releases as 
required. It also provides advance tax 

rulings in response to taxpayer requests 
for clarification of the tax treatment that 
may apply in particular situations.

Provincial tax legislation is administered 
by the appropriate government 
department or ministry (usually Finance). 
These provincial tax authorities also 
publish guidance on the application of 
the legislation, in various forms. 

The websites of the federal and 
provincial tax authorities are listed in 
the Appendix. 

Filing Requirements and 

Tax Payments 

Corporations 

Corporate income tax returns are 
due six months following the end of 
the corporation’s fiscal year. With the 
exception of Alberta and Québec, the 
federal government collects taxes 
on behalf of the provinces so an 
additional provincial corporate income 
tax return is not required.

Corporations are required to pay monthly 
federal and provincial tax instalments 
during the year.

The balance of federal and provincial 
taxes owing (after instalments) is due 
two months after the end of the taxation 
year. The deadline is extended to three 
months after the end of the taxation 
year for a Canadian-controlled private 
corporation whose taxable income is 
(together with associated corporations) 
less than $500,000.

Individuals

An individual must file a federal income 
tax return and, if applicable, a Québec 
income tax return. Individuals must use 
a calendar year for tax purposes. Federal 
and Québec personal income tax returns 

for individuals other than self-employed 
individuals must be filed by April 30 
of the following year. Self-employed 
individuals with professional income 
or income from an unincorporated 
business have until June 15 of the 
following year to file their federal and 
Québec personal income tax returns.

Employed individuals are subject to 
source withholdings by the employer 
(payroll tax). Individuals who are not 
employed but have income from a 
business or property above a specified 
threshold are required to pay quarterly 
federal and provincial income tax 
instalments.

For all individuals, whether employed 
or self-employed, the balance of 
federal and provincial tax owing for a 
taxation year is due by April 30 of the 
following year.

Trusts

There are two categories of trusts, 
inter-vivos trusts and testamentary 
trusts. Inter-vivos trusts are established 
by a living person; a testamentary 
trust is established on the death of 
an individual. Inter-vivos trusts, which 
include virtually all commercial trusts, 
must have calendar fiscal years. They 
must file federal and, if applicable, 
Québec returns, and pay the balance 
of tax owing (after instalments), within 
90 days of the end of each taxation year. 
Testamentary trusts can establish a 
year-end that is different than a calendar 
year. Special rules apply to the filing 
requirements of testamentary trusts. 
However, in a June 2013 consultation 
paper, the federal government proposed 
to eliminate these and other advantages 
in order to align the treatment of 
testamentary trusts with that of 
inter-vivos trusts. Testamentary trusts are 
rarely used in commercial arrangements.

© 2013 KPMG LLP, a Canadian limited liability partnership and a member firm of the KPMG network of independent member firms 
affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.

 

Overview of the Canadian Tax Regime 

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