What is RL-11 Slip – Flow-Through Shares

RL-11 Slip – Flow-Through Shares

The RL-11 slip must be filed by any development corporation that entered into a written agreement with investors to issue flow-through shares and, consequently, to incur Canadian exploration expenses or Canadian development expenses and to renounce those expenses in favour of the investors (the beneficiaries of the renunciation).

Purpose of the RL-11 slip

The RL-11 slip is used to report information concerning:

the Canadian exploration expenses or Canadian development expenses that a development corporation renounced in favour of an investor;

the allocation of assistance it received or was entitled to receive, as a mandatary (agent), in respect of the expenses referred to in the previous point; and

the adjustment of previously renounced expenses.

The RL-11 slip is also used to report share issue expenses renounced by the corporation in favour of an individual or a partnership (whose members include at least one individual) that holds flow-through shares.

How to Complete the RL-11 Slip (Box by Box Instructions)

Box A – Canadian exploration expenses

Enter the amount of Canadian exploration expenses.

If the amount in box A includes renewable and conservation expenses incurred in Québec, enter “A-1” in one of the blank boxes for entering additional information, followed by the amount of those expenses.

If the amount in box A includes exploration expenses incurred in Québec for which an additional deduction cannot be claimed, enter “A-2” in one of the blank boxes, followed by the amount of those expenses.

Box B – Canadian development expenses

Enter the amount of Canadian development expenses.

If the amount in box B includes Québec development expenses, enter “B-1” in one of the blank boxes, followed by the amount of those expenses.

If the amount in box B includes accelerated Canadian development expenses, enter “B-2” in one of the blank boxes, following by the amount of those expenses.

Box D – Québec exploration expenses

Enter the amount of Québec exploration expenses, which are included in box A.

Box E – Québec surface mining exploration expenses or oil and gas exploration expenses

Enter the amount of Québec surface mining exploration expenses or oil and gas exploration expenses, which are included in box D.

Box F – Expenses for exploration in northern Québec

Enter the amount of expenses for exploration in northern Québec, which are included in box D.

Box G – Amounts of assistance corresponding to the expenses reported in boxes A through F

Enter in the appropriate box the renouncee’s share of the amounts of assistance corresponding to the expenses reported in boxes A through F.

Box H – Share issue expenses

Enter the amount of the share issue expenses renounced by the corporation in favour of a renouncee.

Boxes under “Renseignements complémentaires” (additional information)

Box A-1

Renewable and conservation expenses incurred in Québec. See the instructions for line 260 in the guide to the income tax return

Box A-2

Québec exploration expenses that do not give entitlement to an additional deduction. See the instructions for line 260 in the guide to the income tax return.

Box B-1

Québec development expenses. See the instructions for line 260 in the guide to the income tax return.

Box B-2

Accelerated Canadian development expenses. You can claim a deduction for these expenses on line 241 of your return. For information on how to calculate the deduction, contact Revenu Québec.

For further information please contact Taxtron Support at 416-491-0333 or visit www.taxtron.ca