Tax Memo: The CRA Accepts Refund Claims by U.S. LLCs

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The Canada Revenue Agency (CRA) recently announced that it will accept refund claims by US limited liability companies (LLCs) in some circumstances, as a result of the decision of the Tax Court of Canada (TCC) in TD Securities (USA) LLC v. Her Majesty The Queen. In that decision, the TCC held that a US LLC was entitled to treaty benefits under the Canada-United States Income Tax Convention (the Treaty) even before the Fifth Protocol to the Treaty entered into force.

The CRA’s announcement (in Document No. 2010-0369271C6) may allow other U.S. LLCs that were denied Treaty benefits to claim refunds of Canadian taxes paid.

Read this Tax Memo for the background on this decision, the CRA’s views and our response.