This guide summarizes the main features of the Canadian income and mining tax systems currently in effect throughout the country. Quantitative examples give further insight into the application of the systems.
A variety of distinct business structures have evolved to facilitate mine development, including partnerships, joint ventures, flow-through share financing, farm-ins and royalty arrangements. Normally, a tax regime will accord different treatment to each of these structures, affecting the tax effectiveness of that structure in a given situation. This guide describes the basics of the more common business structures, along with their treatment for tax purposes.
This guide also provides a broad overview of Canada’s system for taxing foreign mining projects, whether held through branches or foreign subsidiaries, and lists some special considerations for non-resident investors in Canada.