Baytex Energy Corp. says that certain of its indirect subsidiaries have received a letter (the "Proposal Letter") from the Canada Revenue Agency (the "CRA") advising that, subject to submissions by Baytex, the CRA is proposing to reassess those subsidiaries to deny non-capital loss deductions relevant to the calculation of income taxes for the years 2011 through 2013.

In 2010, Baytex acquired several private entities with accumulated non-capital losses of $591 million. The proposed reassessments seek to disallow the deduction of these non-capital losses under the general anti-avoidance rule of the Income Tax Act (Canada).

If the non-capital losses that have been claimed to-date were ultimately disallowed, it is expected to result in an estimated liability for the previous taxation years of approximately $57 million and a reduction of approximately $262 million of non-capital losses which could otherwise be available to reduce income taxes in subsequent taxation years.

Tags: Baytex Energy Corp.