Income tax – Public private partnership projects and business continuity test for losses

This QWBA confirms that s IB 3(2)(c), which is a central requirement of the business continuity test, is not breached when a standard PPP project transitions from the design and construction phase to the operation and maintenance phase. Accordingly, a corporate PPP contractor may generally rely on the business continuity test to carry forward losses incurred during the design and construction phase, even if shareholder continuity is breached during that phase.