• Service: Tax, Global Compliance Management Services, International Tax
  • Type: Regulatory update
  • Date: 12/19/2013

Canada - P.E.I. tax treatment of non-eligible dividends, credit unions 

December 19:  Legislation in Price Edward Island that increases the tax rate on non-eligible dividends to 38.74% (up from 38.56%) received Royal Assent on 8 December 2013.

The provisions in the legislation (Bill 7) are effective 1 January 2014.

Bill 7 provides for the gradual phase-out of the additional deduction for credit unions—mirroring the federal changes announced in the 2013 federal budget.

Substantially enacted

The provisions in Bill 7 are considered substantively enacted for purposes of IFRS and Accounting Standards for Private Enterprise (ASPE) as of 13 November 2013, when Bill 7 received first reading in the provincial legislature (because P.E.I. has a majority government).

Bill 7 is enacted for U.S. GAAP purposes on 6 December 2013, the date the bill received Royal Assent.

Read a December 2013 report prepared by the KPMG member firm in Canada: P.E.I. Bill for 2014 Non-Eligible Dividends and Credit Unions Receives Royal Assent

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