Regulations Amending the Income Tax Regulations (Federal Crown Corporations): SOR/2026-228

Canada Gazette, Part II, Volume 160, Number 22

Registration
SOR/2026-228 October 23, 2026

INCOME TAX ACT

P.C. 2026-1015 October 23, 2026

Her Excellency the Governor General in Council, on the recommendation of the Minister of Finance, makes the annexed Regulations Amending the Income Tax Regulations (Federal Crown Corporations) under section 221footnote a of the Income Tax Actfootnote b.

Regulations Amending the Income Tax Regulations (Federal Crown Corporations)

Amendment

1 (1) Section 7100 of the Income Tax Regulationsfootnote 1 is amended by striking out “and” the end of paragraph (j), by adding “and” at the end of paragraph (k) and by adding the following after paragraph (k):

(2) Subsection (1) comes into force on the date in which it is published in the Canada Gazette.

REGULATORY IMPACT ANALYSIS STATEMENT

(This statement is not part of the Regulations.)

Issues

A wholly owned subsidiary of Build Canada Homes, Build Canada Homes Holdings Inc., intends to acquire all of the shares of the capital stock in Canada Lands Company CLC Limited and Parc Downsview Park Inc., from Canada Lands Company Limited.

An amendment to the Income Tax Regulations (the Regulations) is required to provide for the taxability of Build Canada Homes Holdings Inc. before the shares are transferred.

Background

Build Canada Homes Holdings Inc. is a federal Crown corporation and a wholly owned subsidiary of Build Canada Homes. Build Canada Homes Holdings Inc. would be responsible for acquiring and holding the Government of Canada’s interest in Canada Lands Company CLC Limited and Parc Downsview Park Inc., and their related properties, from Canada Lands Company Limited.

Under Part I of the Income Tax Act (the Act), federal Crown corporations are exempt from tax. Subsection 27(2) of the Act provides an exception to the exemption in respect of corporations which are prescribed by section 7100 of the Regulations (i.e. prescribed corporations become taxable).

Objective

The objective of this amendment is to ensure that Build Canada Homes Holdings Inc. is a taxable Crown corporation.

Description

This amendment adds Build Canada Homes Holdings Inc. to the list of prescribed Crown corporations found in section 7100 of the Regulations, making it taxable under the Act.

Regulatory development

Consultation

Given that this amendment only impacts Build Canada Homes, of which Build Canada Homes Holdings Inc. is a subsidiary, and Canada Lands Company Limited, no external consultations were undertaken.

Indigenous engagement, consultation and modern treaty obligations

The Department of Finance, in accordance with the Cabinet Directive on the Federal Approach to Modern Treaty Implementation, completed an assessment of modern treaty implications and determined that the amendments to the Regulations are not expected to impact Indigenous peoples or the Government’s obligations in relation to rights protected by section 35 of the Constitution Act, 1982, modern treaty obligations or the United Nations Declaration on the Rights of Indigenous Peoples.

Instrument choice

Regulatory amendments are required to designate Crown corporations as taxable. No other type of instrument is available under the Act to achieve this objective.

Regulatory analysis

Benefits and costs

The benefits and costs associated with the amendment are expected to be minimal for both the Government and stakeholders.

Small business lens

The small business lens does not apply to this amendment, as it does not impact small businesses.

One-for-one rule

The one-for-one rule does not apply, as there is no incremental change in the administrative burden on business and no regulatory titles are repealed or introduced.

Regulatory cooperation and alignment

This amendment does not have a regulatory cooperation component.

International obligations

The amendments are not subject to obligations in Canada’s international trade agreements.

Effects on the environment

In accordance with the Cabinet Directive on Strategic Environmental and Economic Assessment, a preliminary scan concluded that a strategic environmental and economic assessment is not required.

Gender-based analysis plus

No gender-based analysis plus (GBA+) impacts have been identified for this proposal.

Implementation, compliance and enforcement, and service standards

The Canada Revenue Agency will administer the amendment to the Regulations. In accordance with the Act, the amended Regulations would come into force upon publication in the Canada Gazette, Part II.

Contact

Lucas Wilson
Tax Legislation Division
Department of Finance
James Michael Flaherty Building
90 Elgin Street
Ottawa, Ontario
K1A 0G5
Telephone: 343‑574‑2876