A regulation currently exists in the Income Tax Regulations that requires all Canadian partnerships to file an annual information return. However, in the past, an exemption has been made for partnerships with fewer than 6 partners. The CRA has recently reviewed the conditions for partnership filing exemptions, and has decided to remove this exemption.
New SR&ED filing requirements have been introduced for partnerships with fiscal year ends ending on or after January 1, 2011:
- Each person who holds an interest in a partnership must complete and file a separate Partnership Information Return for each T5013 information slip (when an interest is held for another person).
- Corporations that are a member of a partnership can no longer file form T661 along with its T2 Corporation Income Tax Return. ITCs allocated to corporations by partnerships must be supported by a completed Form T5013, Statement of Partnership Income.
- Partnerships with a corporate member must file a Partnership Information Return. The partnership must file a completed Form T661 SR&ED Expenditures Claim with this return.
