CALU submission regarding March 22, 2016 budget proposals

CALU recently wrote to the Department of Finance to comment on proposed changes contained in the March 22, 2016 federal budget relating to the tax treatment of certain transactions involving life insurance owned by partnerships and corporations. In particular, CALU indicated that is it generally supportive of these proposals as they apply to transactions entered into on or after the budget date. However, CALU expressed concerns with the retroactive application of these rules to insurance arrangements entered into before the budget date, and noted other issues that should be addressed as part of Finance’s review of the rules governing life insurance and the capital dividend account, and subsection 148(7) of the Income Tax Act.