This is a multiplier used to "gross up" the foreign tax so it can be deducted against Canadian income. It is designed to represent the reciprocal of the Canadian tax rate. How the Calculation Works
The term refers to the formula used to calculate tax deductions for Foreign Accrual Property Income (FAPI) . When a Canadian taxpayer earns passive income through a Controlled Foreign Affiliate (CFA) , they are taxed on that income in Canada as it is earned. To prevent double taxation, the Canada Revenue Agency (CRA) allows a deduction based on the foreign taxes already paid. fat.rtf
For certain investment income, the RTF for corporations was reduced from 4.0 to 1.9 . This is a multiplier used to "gross up"
The deduction is calculated by multiplying the by the RTF . Entity Type Current RTF Multiplier Implied Tax Rate Threshold Corporations Individuals When a Canadian taxpayer earns passive income through
When searching for lost files, recovery software like DiskInternals lists FAT (the file system) and .rtf (Rich Text Format) as common keywords, which can lead to the combined term appearing in search results.
Here is a deep dive into the world of fat.rtf (FAT/RTF) and why it matters to businesses and individuals with foreign investments. The Core Components