SCC denies leave to appeal the Inter-Leasing GAAR decision of the Ontario Court of Appeal – taxpayer victorious

Précis: The Supreme Court of Canada today denied the Crown’s application for leave to appeal the decision of the Ontario Court of Appeal in Inter-Leasing, Inc. v. Ontario (Minister of Revenue) 2014 ONCA 575, [2014] O.J. No. 3671.

That decision upheld the validity of a tax plan under which a corporation incorporated in the British Virgin Islands and with a permanent establishment in Ontario received interest payments on specialty debt instruments that were physically situate in the BVI. That interest was not subject to tax by Ontario.  The Court of Appeal held that Ontario GAAR did not apply to the plan; the Supreme Court of Canada’s refusal to grant leave has put the issue to rest. Roughly $55 million in tax and interest was at stake.

Source: Supreme Advocacy Letter #11
http://supremeadvocacy.ca/