Amalgamations

For the LNG income tax, an amalgamated corporation is treated as a new corporation with a first taxation year that begins at the time of amalgamation. However, there are circumstances where certain tax attributes may flow-through from a predecessor corporation to an amalgamated corporation. 

Your amalgamation may qualify for a flow-through of tax attributes if all of the following requirements are met:

  1. The amalgamation is effected under specific rules in the B.C. Business Corporations Act or the Canada Business Corporations Act or similar provisions of a Canadian federal or provincial law.
  2. Two or more of the predecessor corporations are LNG taxpayers in respect of liquefaction activities at an LNG facility.
  3. All predecessor corporations are continued in the amalgamated corporation.
  4. All of the property, rights and interests of the predecessor corporations become the property, rights and interests of the amalgamated corporation.
  5. All of the liabilities of the predecessor corporations become the liabilities of the amalgamated corporation.

Tax attributes that may flow-through from the predecessor corporations to the amalgamated corporation include:

A new corporation that is a result of an amalgamation doesn’t qualify for first taxation year elections.