Canada continues to be an attractive market for private equity (“PE“) investors with recent transactions highlighting significant investments into Canadian real estate and energy infrastructure assets.

Partnerships (particularly, limited partnerships) continue to be a popular PE vehicle, providing a means of pooling and aggregating investment funds and allowing for income or losses to be “flowed-through” to its members for Canadian tax purposes, subject to certain exceptions.

However, the use of partnerships with non-resident investors in PE investments raises two particular issues.

Withholding Tax

Part XIII of the Income Tax Act (Canada) (the “Tax Act“), requires that … Continue Reading