Condition 5 - Tainted income ratio less than 5%



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End of attention

To pass the active income test, the tainted income ratio of a CFC for a statutory accounting period must be less than 0.05 - that is, less than 5%. If both the bottom line and the top line of the relevant formula is nil, the CFC is taken to have passed the active income test.

Last modified: 05 Dec 2006QC 18000