From Daniel Gosselin, “Reversing Prohibited Status of Small Business Shares in RRSPs”, Tax for the Owner-Manager, 15:4 (October 2015):
In a technical interpretation (TI 2015-0579671E5, May 28, 2015), the CRA confirms that the shares of a corporation that ceases to qualify as a specified small business corporation during a taxation year will not become a prohibited investment of an RRSP, a RRIF, or a TFSA until the beginning of the corporation’s following taxation year. Furthermore, the CRA says that if the corporation’s status as a specified small business corporation is re-established before the end of the particular year, its shares may not become a prohibited investment at year-end, subject to the possible application of GAAR.
