Canada Dominion Resources Group - How Do Flow Through Shares Work?

Flow-Through Shares: An Investment Opportunity

The federal government allows Canadian companies, who meet certain criteria and are engaged in resource exploration, to write off the full cost of these activities by claiming the Canadian Exploration Expense deduction (CEE) as defined by the Tax Act. As a means of raising capital for exploration, these companies may issue flow-through shares, whereby the 100% tax-deductible CEE is "flowed-through" to the purchaser of these shares.