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Tax InformationGeneral U.S. and Canadian Tax SummaryThe...

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    Tax Information
    General U.S. and Canadian Tax Summary

    The following discussion is intended to provide a general explanation of the U.S. and Canadian tax treatment of holding Brookfield Infrastructure Partners units. For a more detailed and comprehensive discussion please refer to Brookfield Infrastructure Partners? most recent annual report on form 20-F.

    This summary is of a general nature only and is not intended to be, nor should it be construed to be, legal or tax advice to any particular holder of BIP units, and no representation with respect to the U.S. and Canadian income tax consequences to any particular holder is made. Consequently, holders of BIP units are advised to consult their own tax advisors with respect to their particular circumstances.
    Characterization of BIP for Tax Purposes

    Brookfield Infrastructure Partners L.P. is a Bermuda based limited partnership that is treated as a partnership for U.S. and Canadian tax purposes. Brookfield Infrastructure Partners is not a corporation or a trust. Brookfield Infrastructure Partners is a publicly traded partnership that does not earn active business income. Instead, Brookfield Infrastructure Partners earns interest and dividends from subsidiary corporations in various jurisdictions that carry on infrastructure businesses.

    Brookfield Infrastructure Partners units qualify for IRA accounts. Brookfield Infrastructure Partners is a qualified investment for RRSPs, deferred profit sharing plans, RRIFs, registered education savings plans, registered disability savings plans and TFSAs.
    Partnership ID Numbers

    Brookfield Infrastructure Partner?s U.S. tax identification number is 98-0544123 and its Canadian tax identification number is HB1008588.
    Flow-Through Nature of BIP

    As a partnership, Brookfield Infrastructure Partners is a so-called ?flow through? for U.S. and Canadian tax purposes. That is, Brookfield Infrastructure Partners is not subject to tax, instead its income, (determined under U.S. tax rules using the U.S. dollar as its functional currency and under Canadian tax rules using the Canadian dollar as its functional currency) is subject to tax in the hands of its unitholders.

    Income for U.S. and Canadian tax purposes is unlikely to be equal because of (i) the different currencies used to compute the taxable income for each jurisdiction and (ii) the difference in the tax rules of the two countries applicable to the income and expenses of Brookfield Infrastructure Partners and its subsidiaries for a particular taxation year. Brookfield Infrastructure Partner?s taxable income will be comprised of various types of income and expenses and may include such items as interest income, foreign source dividends, local source dividends, eligible and qualified dividends, and short-term and long term capital gains.
    Communication of Tax Information

    After the end of Brookfield Infrastructure Partner?s taxation year (December 31), the U.S. and Canadian taxable income of Brookfield Infrastructure Partners is determined and allocated to all unitholders that are in turn required to report such income in their respective tax returns. The allocation of U.S. taxable income is communicated using Schedule K-1 (not a Form 1099). The allocation of Canadian taxable income is communicated using Form T5013 (not a Form T5).

    All unitholders should receive a Schedule K-1 from Brookfield Infrastructure Partners. We are required to use reasonable efforts to send a Schedule K-1 to all unitholders (not just U.S. residents). Consequently, Canadian unitholders may receive a Schedule K-1 in addition to Form T5013. In general, Canadian resident unitholders may disregard the Schedule K-1 (unless for example, they are a U.S. citizen).

    Canadian registered holders of Brookfield Infrastructure Partners units will receive a T5013 directly from Brookfield Infrastructure Partners. All other Canadian unitholders should receive a T5013 from their Canadian broker. Brookfield Infrastructure Partners voluntarily provides Forms T5013 to assist Canadian unitholders with the accurate reporting of taxable income associated with the ownership of BIP units.

    If you are a U.S. holder or a Canadian resident registered holder and did not receive your Schedule K-1 or Form T5013, respectively, for the previous taxation year please contact us at
    1-866-949-2771 or at www.taxpackagesupport.com/brookfield.
    Relationship of Taxable Income to Distributions

    The computation of Brookfield Infrastructure Partners? annual U.S. and Canadian taxable income for a particular taxation year is independent of (i) the annual accounting income of Brookfield Infrastructure Partners; (ii) the annual cash generated by Brookfield Infrastructure Partners and (iii) the annual distributions. As an investor in Brookfield Infrastructure Partners, holders are required to pay tax on their proportionate share of Brookfield Infrastructure Partners? taxable income. The U.S. and Canadian taxable income of Brookfield Infrastructure Partners is determined using U.S. and Canadian tax rules and will vary from year to year depending on the nature of the income of Brookfield Infrastructure Partners and its subsidiaries for the particular taxation year.
    Tax Treatment of Distributions

    Distributions received by Brookfield Infrastructure Partners? unitholders are not directly taxable in and of themselves. Distributions received reduce the tax cost of Brookfield Infrastructure Partners units. The distributions Brookfield Infrastructure Partners pays do not have a particular character or composition. Brookfield Infrastructure Partners does not pay returns of capital like a corporation or trust may.
    Computation of Tax Cost

    In general, a unitholder?s tax cost of his/her Brookfield Infrastructure Partners units should equal the sum of (i) the amount paid to acquire the units and (ii) the net taxable income allocated to the unitholder, minus the cash distributions received.1

    The schedules distributed with Schedule K-1 compute the tax cost of Brookfield Infrastructure Partners units for U.S. residents.

    For Canadian residents, the tax cost of units is determined in Canadian dollars so all three components should be determined in Canadian dollars. Brookfield Infrastructure Partners does not have sufficient information to track the tax cost of units for each individual holder. Depending upon the particular taxation year, the T5013 will report various sources of income and expenses in a number of boxes on the form. The net taxable income allocated is the sum of the various income and expenses. Unitholders are obligated to accurately compute the tax cost of their Brookfield Infrastructure Partners units.
    Other Tax Matters

    Effectively Connected Income (ECI)
    Brookfield Infrastructure Partners has not and is not expected to generate effectively connected income (ECI). Brookfield Infrastructure Partners? U.S. operations are carried out through its wholly owned U.S. resident subsidiary, Brookfield Infrastructure Corporation.

    Unrelated Business Taxable Income (UBTI)
    Brookfield Infrastructure Partners currently has a revolving credit facility that is used from time to time for various purposes. The use of the credit facility may generate UBTI. Debt financed UBTI has not been and is not expected to be a material portion of Brookfield Infrastructure Partners? income. UBTI is relevant to U.S. tax exempt entities.

    Foreign Investment Real Property Tax Act (FIRPTA)
    Non-U.S investors that own 5% or less of Brookfield Infrastructure Partners units should not be subject to FIRPTA taxation on a disposition of their units. Investors that own more than 5% of Brookfield Infrastructure Partners units may be subject to FIRPTA taxation on a disposition of their units.

    1 The U.S. dollar distributions must be converted to Canadian dollar before reducing the tax cost of Brookfield Infrastructure Partners units for Canadian tax purposes. Brookfield Infrastructure Partners does not prescribe a particular foreign exchange rate that unitholders should use to make such conversions. Unitholders and/or their brokers would generally be expected to use the conversion rate on the date of receipt of the distribution.

    Note: The information provided on this website does not constitute tax advice and is not intended to be a substitute for tax planning. Investors are encouraged to consult their tax advisors concerning the income tax consequences particular to their receipt, ownership and disposition of units, as well as any consequences under the laws of any other taxing jurisdiction.
    Specified Foreign Property

    For the purpose of reporting foreign property by Canadian investors, pursuant to section 233.3 of the Canadian Income Tax Act, Brookfield Infrastructure Partners is a specified foreign property.

    http://www.brookfieldinfrastructure.com/content/investor_relations/tax_information-2633.html
 
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