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FORM 20-F/A Brookfield Property Partners L.P. - Brookfield Asset ...

FORM 20-F/A Brookfield Property Partners L.P. - Brookfield Asset ...

FORM 20-F/A Brookfield Property Partners L.P. - Brookfield Asset ...

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“taxable Canadian property”. Units of our company will be “treaty protected property” if the gain on thedisposition of our units is exempt from tax under the Tax Act under the terms of an applicable income tax treatyor convention. It is not expected that our units will constitute “taxable Canadian property” at any time but noassurance can be given in this regard. If our units constitute “taxable Canadian property”, non-Canadian limitedpartners will be required to file a Canadian federal income tax return in respect of a disposition of or units unlessthe disposition is an “excluded disposition” (as discussed above). If our units constitute “taxable Canadianproperty”, non-Canadian limited partners should consult their own tax advisors with respect to the requirement tofile a Canadian federal income tax return in respect of a disposition of our units.Non-Canadian limited partners may be subject to Canadian federal income tax reporting and withholding taxrequirements on the disposition of “taxable Canadian property”.Non-Canadian limited partners who dispose of “taxable Canadian property”, other than “excludedproperty”, as defined in subsection 116(6) of the Tax Act, and certain other property described in subsection116(5.2) of the Tax Act, (or who are considered to have disposed of such property on the disposition of suchproperty by our company or the <strong>Property</strong> <strong>Partners</strong>hip), are obligated to comply with the procedures set out insection 116 of the Tax Act and obtain a certificate thereunder. In order to obtain such certificate, thenon-Canadian limited partner is required to report certain particulars relating to the transaction to CRA not laterthan 10 days after the disposition occurs. Our units are not expected to be “taxable Canadian property” andneither our company nor the <strong>Property</strong> <strong>Partners</strong>hip is expected to dispose of property that is “taxable Canadianproperty” but no assurance can be given in these regards.Payments of dividends or interest (other than interest exempt from Canadian federal withholding tax) byresidents of Canada to the <strong>Property</strong> <strong>Partners</strong>hip will be subject to Canadian federal withholding tax and wemay be unable to apply a reduced rate taking into account the residency or entitlement to relief under anapplicable income tax treaty or convention of our unitholders.Our company and the <strong>Property</strong> <strong>Partners</strong>hip will be deemed to be a non-resident person in respect ofcertain amounts paid or credited to them by a person resident or deemed to be resident in Canada, includingdividends or interest. Dividends or interest (other than interest exempt from Canadian federal withholding tax)paid by a person resident or deemed to be resident in Canada to the <strong>Property</strong> <strong>Partners</strong>hip will be subject towithholding tax under Part XIII of the Tax Act at the rate of 25%. However, the CRA’s administrative practice insimilar circumstances is to permit the rate of Canadian federal withholding tax applicable to such payments to becomputed by looking through the partnership and taking into account the residency of the partners (includingpartners who are resident in Canada) and any reduced rates of Canadian federal withholding tax that anynon-Canadian limited partners may be entitled to under an applicable income tax treaty or convention providedthat the residency status and entitlement to treaty benefits can be established. In determining the rate of Canadianfederal withholding tax applicable to amounts paid by the Holding Entities to the <strong>Property</strong> <strong>Partners</strong>hip, we expectthe Holding Entities to look-through the <strong>Property</strong> <strong>Partners</strong>hip and our company to the residency of the partners ofour company (including partners who are residents of Canada) and to take into account any reduced rates ofCanadian federal withholding tax that non-Canadian limited partners may be entitled to under an applicableincome tax treaty or convention in order to determine the appropriate amount of Canadian federal withholdingtax to withhold from dividends or interest paid to the <strong>Property</strong> <strong>Partners</strong>hip. However, there can be no assurancethat the CRA will apply its administrative practice in this context. If the CRA’s administrative practice is notapplied and the Holding Entities withhold Canadian federal withholding tax from applicable payments on a lookthroughbasis, the Holding Entities may be liable for additional amounts of Canadian federal withholding tax plusany associated interest and penalties. Under the Canada-United States Tax Convention, or the Treaty, a Canadianresident payer is required in certain circumstances to look-through fiscally transparent partnerships, such as ourcompany and the <strong>Property</strong> <strong>Partners</strong>hip, to the residency and treaty entitlements of their partners and take intoaccount the reduced rates of Canadian federal withholding tax that such partners may be entitled to under theTreaty.35

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