FAQ
Frequently Asked Questions
Technical Tax Questions
Q1. What is a Joint Tax Election?
A Joint Tax Election is a tax election filed jointly by a Unitholder and BIP Inc. under section 85 of the Tax Act. It allows an Eligible Canadian Holder (a Canadian resident, taxable Unitholder, as outlined in the Circular) of BIP units or Exchangeable Units to defer all or part of the capital gain that would otherwise arise on the exchange of those BIP units or Exchangeable Units pursuant to the Transaction.
In practice, the Unitholder and BIP Inc. agree on a single dollar figure — the “Elected Amount” — which is treated for tax purposes as both the proceeds of disposition of the BIP units or Exchangeable Units and the cost of the BIP Inc. Class A Shares received. By choosing an Elected Amount within the limits set by section 85 (broadly, between the adjusted cost base of the BIP units or Exchangeable Units and their fair market value at the time of the exchange), the Unitholder can fully or partially defer the capital gain.
The Joint Tax Election is filed using CRA Form T2057 (or, where the Securities are held by a partnership, CRA Form T2058), together with any required provincial election forms. The detailed mechanics, eligibility rules, Elected Amount limits, deadlines and process for preparing and filing the forms are described in the questions that follow and, more fully, in the Circular.
Q2. What is the taxation implication for holders of BIP units, Exchangeable Units and BIPC exchangeable shares in connection with the receipt of BIP Inc. Class A Shares?
The Transaction involves an exchange of BIP units, Exchangeable Units and BIPC exchangeable shares for new BIP Inc. Class A Shares. The exchange of BIP units and Exchangeable Units by a resident of Canada is generally considered a taxable event that may give rise to a capital gain (or loss). Alternatively, Eligible Canadian Holders may wish to defer the realization of all or a portion of the capital gain by requesting to jointly file an election with BIP Inc. in accordance with section 85 of the Tax Act. The exchange of BIPC exchangeable shares by a resident of Canada for solely BIP Inc. Class A Shares, will generally be entitled to the automatic rollover provisions in section 85.1 of the Tax Act. No Tax Election is required.
For additional information and a more complete summary of the principal Canadian federal income tax considerations of the Transaction, please refer to the Circular.
For the purpose of this site, we have duplicated certain information from the Circular.
Transaction – No Section 85 Election
The exchange of BIP units or Exchangeable Units generally will be a taxable disposition for Canadian income tax purposes.
Such a Unitholder will realize a “capital gain” (or “capital loss”) (as each such term is defined in the Tax Act) to the extent that the proceeds of disposition of the BIP units or Exchangeable Units so disposed of, net of any reasonable costs of disposition, exceed (or are less than) the “adjusted cost base” (as defined in the Tax Act) to the Unitholder of such BIP units or Exchangeable Units.
Unless such holder chooses to recognize a capital gain or capital loss on the exchange, the exchange of BIPC exchangeable shares by a resident of Canada for solely BIP Inc. Class A Shares, will generally be entitled to the automatic rollover provisions in section 85.1 of the Tax Act. No Tax Election is required.
Transaction – Section 85 Election
Generally, an Eligible Canadian Holder who validly makes a Joint Tax Election with BIP Inc. under section 85 of the Tax Act may obtain a full or partial deferral of any capital gain that would otherwise arise on the disposition of such Eligible Canadian Holder’s BIP units or Exchangeable Units.
BIP Inc. has agreed to make a Joint Tax Election with an Eligible Canadian Holder at the elected amount (the “Elected Amount”) determined by such Eligible Canadian Holder, subject to the limitations set out in section 85 of the Tax Act.
The limitations imposed by the Tax Act in respect of the Elected Amount are that the Elected Amount:
- may not be less than the lesser of:
- the adjusted cost base to the Eligible Canadian Holder of the BIP units or Exchangeable Units that are exchanged, determined immediately before the time of the exchange; and
- the fair market value of such BIP units or Exchangeable Units at that time;
- may not exceed the fair market value of such BIP units or Exchangeable Units at the time of the exchange.
Where an Eligible Canadian Holder and BIP Inc. make a Joint Tax Election that complies with the above rules and the Joint Tax Election is filed on a timely basis, the tax treatment to the Eligible Canadian Holder will generally be as follows:
- such BIP units or Exchangeable Units that are the subject of the Joint Tax Election will be deemed to be disposed of by the Eligible Canadian Holder for proceeds of disposition equal to the Elected Amount;
- if such proceeds of disposition in respect of such BIP units or Exchangeable Units are equal to the aggregate of the adjusted cost base thereof to the Eligible Canadian Holder, determined immediately before the exchange, and any reasonable costs of disposition, no capital gain or capital loss will be realized by the Eligible Canadian Holder;
- to the extent that such proceeds of disposition in respect of such BIP units or Exchangeable Units exceed the aggregate of the adjusted cost base of such BIP units or Exchangeable Units to the Eligible Canadian Holder and any reasonable costs of disposition, such Eligible Canadian Holder will in general realize a capital gain; and
- the cost to the Eligible Canadian Holder of the BIP Inc. Class A Shares acquired on the exchange will generally be equal to the Elected Amount.
Taxation of Registered Plans
Holders who hold their BIP units or Exchangeable Units through Registered Plans (as outlined in the Circular, including TFSAs, RRSPs, and certain other registered plans) and deferred profit sharing plans (as defined in the Tax Act) will not be Eligible Canadian Holders and will therefore not qualify to file a Joint Tax Election.
Q3. How do I calculate the ACB of my Units?
The starting point of determining the ACB of shares that are capital property will generally be the amount that the Unitholder paid for the BIP units or Exchangeable Units when such BIP units or Exchangeable Units were originally acquired plus reasonable costs to acquire the BIP units or Exchangeable Units such as broker commissions and fees. The ACB may be adjusted in certain circumstances (e.g., where a Unitholder received their BIP units or Exchangeable Units due to a previous tax-deferred transaction or by way of a gift, or through annual allocations of partnership income and distributions). Special rules may apply if the BIP units or Exchangeable Units were received as a distribution or through the exercise of options.
The rules for determining ACB are complex. Brookfield does not have the information required to compute each Unitholder’s ACB for the purposes of this election. Unitholders can visit Brookfield’s website, where the ‘Additional Resources’ section provides historical income allocation and distribution information that may assist in calculating the ACB of BIP units. Brookfield intends to update such information in respect of 2026 in February 2027. Unitholders should consult their own tax advisors regarding their specific circumstances.
Q4. I am a non-resident of Canada. What are my tax consequences resulting from the exchange?
Unitholders that are not resident or deemed to be resident in Canada will not be Eligible Canadian Holders and will therefore not qualify to file a Joint Tax Election.
Generally, the BIP units or BIPC exchangeable shares will not constitute “taxable Canadian property” (“TCP”) of a Non-Resident Holder for purposes of the Tax Act. As a result, a Non-Resident Holder generally will not be subject to tax under the Tax Act in respect of a capital gain realized on the disposition of BIP units or BIPC exchangeable shares under the Transaction. This area is complex and such Unitholders should consult their own tax advisors regarding their specific circumstances.
Non-resident Unitholders may still have tax consequences in their country of residence and should consult their own tax advisors regarding their specific circumstances.
Q5. How do I choose an Elected Amount?
As an example, by choosing an Elected Amount equal to the aggregate of the ACB and any reasonable costs of disposition, rather than Fair Market Value (FMV), Eligible Canadian Holders can potentially trigger no immediate capital gain. Alternatively, some Eligible Canadian Holders may choose an amount higher than the aggregate of the ACB and any reasonable costs of disposition, but lower than the FMV, to recognize a gain for offset by personal capital losses or other available deductions, depending on their personal tax situation. Unitholders should consult their own tax advisors regarding their specific circumstances.
Q6. I filed the Joint Tax Election to obtain a full tax-deferred rollover. Do I have to report the disposition on my tax return for the period that includes the disposition of the BIP units or Exchangeable Units?
Yes. You must report the disposition of the BIP units or Exchangeable Units even though you elected to obtain a full deferral of the realization of any capital gain that might otherwise arise on the disposition of your BIP units or Exchangeable Units. Your proceeds of disposition for Canadian income tax purposes will be equal to the Elected Amount set out in box B on page 3 of the federal Joint Tax Election (and equivalent box on a Québec Joint Tax Election).
Q7. If I make a Joint Tax Election in Québec, am I required to make a federal Joint Tax Election?
Yes, a Unitholder making a Québec Joint Tax Election must also make a federal Joint Tax Election. Note that a copy of the federal Joint Tax Election must be submitted to Revenu Québec when filing the Québec Joint Tax Election. A Unitholder that is a corporation established in Québec is required to file the French version of the Québec Joint Tax Election; however, the copy of the federal Joint Tax Election can be the English version.
Q8. When is the deadline to submit the election forms to the tax authorities?
The required election forms must be received by the appropriate tax authorities on or before the day that is the earliest of the days on or before which either BIP Inc. or the electing Eligible Canadian Holder (or any partner thereof where the electing Eligible Canadian Holder is a partnership) is required to file a Canadian income tax return for the taxation year in which the disposition of the Security occurs. The relevant taxation year of BIP Inc. is expected to end on December 31, 2026. BIP Inc.’s income tax return is required to be filed within six (6) months of its taxation year end. Thus, if the exchange occurs prior to December 31, 2026, the tax election forms will, in the case of an electing Eligible Canadian Holder who is an individual (other than a trust), generally be due by April 30, 2027. This deadline may be different if the electing Eligible Canadian Holder is a Corporation, Partnership, Trust, etc. All electing Eligible Canadian Holders should consult their own advisors respecting the deadlines applicable to their own particular circumstances (including, where applicable, provincial deadlines). It is the Eligible Canadian Holder’s responsibility to provide information within a sufficient time so that the election forms can be generated, reviewed, signed and filed in advance of their own applicable filing deadline.
Administrative Questions
Q9. Who is eligible to file a section 85 election?
Only “Eligible Canadian Holders” (as defined in the Circular) are eligible to file a section 85 election. You are an Eligible Canadian Holder if you are or are deemed to be a resident of Canada for Canadian income tax purposes (or, if filing on behalf of a partnership, at least one member of the partnership is or is deemed to be resident of Canada for Canadian income tax purposes) and you are not exempt from tax.
Holders who hold their BIP units or Exchangeable Units through Registered Plans, including TFSAs, RRSPs, and certain other registered plans and deferred profit sharing plans (as defined in the Tax Act), will not be Eligible Canadian Holders and will therefore not qualify to file a Joint Tax Election.
Not sure? Unitholders should consult their own tax advisors regarding their specific circumstances before filing.
Q10. How do I confirm the number of BIP units or Exchangeable Units that I own?
If you are a registered Unitholder (meaning that you either hold a physical certificate or a direct registration statement representing your BIP units or Exchangeable Units), the depositary should be able to provide you with confirmation of your current registered position.
If you hold your BIP units or Exchangeable Units in an account with an investment dealer or broker, they should be able to provide you with this information. Alternatively, this information will be on your most recent brokerage statement.
Q11. I co-owned BIP units or Exchangeable Units with another party (e.g. my spouse). Who should complete and sign the Joint Tax Election?
When one co-owner is chosen to submit the Tax Election Information on behalf of all co-owners (the “Designated Co-Owner”), the Designated Co-Owner must provide the required information for each electing co-owner in their respective questionnaire with each co-owner’s respective ownership interest (i.e., percentage). BIP Inc. will prepare the Joint Tax Election(s) for each co-owner and send the forms to the Designated Co-Owner. Then the Designated Co-Owner must sign one completed copy of each Tax Election and file the forms together with a list of all co-owners electing and proof of authority to sign on behalf of such co-owners with the CRA and provincial tax authority, as applicable.
If there is no Designated Co-Owner, each Co-Owner must complete their own questionnaire. The individual Co-Owner should set out the respective ownership interest (i.e., percentage) of each Co-Owner in the jointly held BIP units or Exchangeable Units so the Tax Election can be prepared.
Q12. Will I receive help to complete the Joint Tax Election?
To enable Eligible Canadian Holders to submit the information required to prepare the Joint Tax Election (the “Joint Tax Election Information”), BIP Inc. has made the questionnaire available to Unitholders in a web-based format through the Tax Election Portal.
After receiving the Joint Tax Election Information submitted using the Tax Election Portal, a Joint Tax Election form(s) will be compiled based solely on the Joint Tax Election Information provided by the Unitholders.
Unitholders may contact the Technical Assistance Hotline (bip-s85support@taxelection.ca) for the Tax Election Portal for technical assistance regarding the submission of information. However, neither BIP Inc. nor any of its appointed representatives supporting the Tax Election Portal will provide legal or tax advice to any Unitholder in connection with their Joint Tax Election.
It is each Unitholder’s responsibility to review the Joint Tax Election form for accuracy and completeness, sign it and file it with the CRA and, if applicable, provincial or territorial taxing authorities.
Neither BIP Inc., the Depositary, nor any of the appointed agents or representatives assisting with the Tax Election Portal will verify the accuracy of the Joint Tax Election Information submitted by a Unitholder.
For a description of the material Canadian federal income tax considerations of the Transaction to Unitholders, please see “Certain Canadian Federal Income Tax Considerations” in the Circular. Discussion of Canadian income tax consequences in the Circular is not intended to be legal, business or tax advice.
Unitholders are urged to consult their own legal and tax advisors as to the tax consequences of the Transaction to them with respect to their particular circumstances.
Q13. I have completed and submitted the questionnaire. What do I do next?
After receiving a properly completed questionnaire, a Joint Tax Election will be compiled using the information that you provided. The completed Joint Tax Election will be provided to you no later than 30 days after submission of the questionnaire, subject to the information you provided being complete. The Joint Tax Election(s) will be executed and an electronic copy will be sent to you using the e-mail address provided in the questionnaire.
You should then review the Joint Tax Election. If you do not agree with the content, calculations or any disclosures, contact the Technical Assistance Hotline indicated in the instructions that will be provided in the e-mail containing the executed election. If you are satisfied, sign and file the Joint Tax Election(s) with the CRA and provincial or territorial taxing authorities, if applicable.
Q14. What if I no longer wish to make a Joint Tax Election after I have completed and submitted the questionnaire?
If you no longer wish to make a Joint Tax Election following completion and submission of the information via the Tax Election Portal, do not file the Joint Tax Election sent to you with the tax authorities. Promptly contact the Technical Assistance Hotline indicated in the instructions provided in the e-mail containing the executed election to notify of your decision to no longer make the Joint Tax Election.
Q15. Is there a fee for making the Joint Tax Election?
No, you are not required to pay any fees to make the Joint Tax Election, provided complete Joint Tax Election Information is provided on or before the Tax Election Portal Closing Date. The CRA and, if applicable, provincial or territorial taxing authorities may levy a penalty for a late filed Joint Tax Election.
Q16. What happens if I do not submit my Joint Tax Election Information by the Tax Election Portal Closing Date?
BIP Inc. has agreed to make a Joint Tax Election with Eligible Canadian Holders, subject to the limitations set out in subsections 85(1) and 85(2) of the Tax Act, only if complete Joint Tax Election Information is provided on or before the Tax Election Portal Closing Date. Therefore, it is important that you provide your complete information by that deadline. BIP Inc. may, but is not obligated to, make a Joint Tax Election if the Joint Tax Election Information is received after the Tax Election Portal Closing Date. Consequently, you should ensure that complete Joint Tax Election Information is received by BIP Inc. in accordance with the procedures set out above by the Tax Election Portal Closing Date. Notwithstanding the foregoing and in its sole discretion, BIP Inc. or any successor corporation may choose to sign and deliver a Joint Tax Election form to a Tax Election Holder if the necessary information is received by it after the Tax Election Portal Closing Date, but will have no obligation to do so and no assurances can be given that BIP Inc. or a successor corporation will do so. Accordingly, if you wish to make a Joint Tax Election with BIP Inc. you should give your immediate attention to this matter.
Need Help?
Reach out to bip-s85support@taxelection.ca for technical and procedural inquiries with the Tax Election Portal, and consult your own tax advisor for advice about eligibility, forms, elected amounts, deadlines, and filing requirements.