My Client has a foreign dividend (connected Co) and also a Dividend from a Local source (Not connected).
My Question is which section do we have to select from (Section 112, 113, 138(6))?
Dividends received from another taxable Canadian corporation or by a resident Canadian Corporation that is controlled by the recipient are deductible from taxable income by virtue of Section 112.
If the dividend was received from a foreign affiliate meeting certain criteria relating to exempt surplus, hybrid surplus, taxable surplus, and/or pre-acquisition surplus the dividend is deductible from taxable income by virtue of Section 113.
If your client is a life insurance company then section 112 does not apply for the deduction of dividends from taxable income. Instead, certain dividends received by a life insurer from taxable Canadian corporations are deductible from taxable income by virtue of subsection 138(6).
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138(6) is for Life insurance.
For your other matters, you may wish to review:
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ITA-S112-113.pdf (152.0 KB)
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So Nice of you.
I was able to resolve the issue with your help. Much appreciated.
So Nice of you.
I was able to resolve the issue with your help. Appreciated & Happy holidays.