The Running Shoe Corp. is a Canadian corporation which plans to expand internationally. The company has decided to establish a foreign branch in another country. Which of the following is FALSE?

Question

Quizplus · Accepted Answer

If the foreign country has a lower tax rate, it does not automatically result in a tax benefit for the Canadian corporation, as the profits will still be included in the Canadian corporation's worldwide income and subject to Canadian tax, potentially offset by foreign tax credits.