Plain meaning
A foreign affiliate over which a Canadian taxpayer or related group has sufficient control under Canadian international tax rules.
Also called
CFA
Key points
- Control is determined under detailed Income Tax Act rules, including ownership by related persons or groups.
- A controlled foreign affiliate can give rise to FAPI inclusions for Canadian taxpayers.
- The status matters for reporting forms, surplus calculations, and cross-border planning.
- It is a subset of foreign affiliate concepts and should be analyzed with the specific ownership facts.
Why it comes up
Controlled foreign affiliate status can trigger FAPI inclusions, reporting, and surplus-account analysis.