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Menzies v. R. - TCC: Tax Court has no jurisdiction over fairness relief

Apr 13, 2016 By Bill Innes

Précis: The taxpayer originally claimed a partnership loss of roughly $88,000 in her 2001 taxation year. The Minister reduced that loss by roughly $20,000 under the terms of a settlement agreement with the partnership. The taxpayer claimed that the reassessment was ineffective because she did not authorize the settlement and did not receive a copy of the Minister’s Notice of Determination and Notice of Redetermination of Loss (the “Determination”). She also claimed interest relief because of the alleged delay of the Minister in reassessing her 2001 taxation year:
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French v. R. - FCA: Partial gifts may be possible in leveraged donation situation

Apr 13, 2016 By Bill Innes

Précis: This appeal was one of a group of tax cases involving so-called leveraged donations, i.e., donations funded in part by loans from promoters. In the notices of appeal Mr. French and the other appellants argued that they should be at least entitled to the portion of the donation made with their own cash. They argued that since partial gifts are permissible under the laws of Quebec taxpayers in other provinces and territories should be entitled to the same relief. The Crown succeeded before the Tax Court in having this pleading struck. Mr. French and the others appealed to the Federal Court of Appeal.
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Ivan Cassell Limited v. R. - TCC: Taxpayer carried on a “personal services business”

Apr 12, 2016 By Bill Innes

Précis: This was a “personal services business” case framed in the narrowest of possible terms (normally a sign of very seasoned counsel):
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R & S Industries v. R. - FC: Late filed application for judicial review dismissed

Apr 11, 2016 By Bill Innes

Précis: The taxpayer attempted to file an amended election in Form T2059 in connection with a transfer of property to a partnership. CRA rejected the amendment and the taxpayer applied to the Federal Court for review of that decision. The application was dismissed with costs both because it was itself late-filed and because there was no basis established to reverse CRA’s decision to refuse the late-filed election.
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1455257 Ontario Inc. v. R. - FCA: Dissolved corporation needs to be revived to file tax appeal

Apr 11, 2016 By Bill Innes

Précis: The appellant corporation had been dissolved under the provisions of the Ontario Business Corporations Act (“OBCA”). It filed an appeal in the Tax Court which concluded that it could not pursue the appeal until its articles had been revived. The taxpayer appealed the Tax Court decision to the Federal Court of Appeal. The Court of Appeal reached the same decision as the Tax Court, although in a somewhat different manner. Thus the appeal was dismissed with costs although the taxpayer was given another 60 days to seek a revival of its corporate status.
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Karam v. R. - FCA: Appeal dismissed from bench - collateral attack on Tax Court Decision

Apr 08, 2016 By Bill Innes

Précis: Mr. Karam was unsuccessful in the Tax Court which concluded that his share of the gain on a sale of real property was business income. He did not appeal that decision but launched a judicial review application in the Federal Court where he sought to restrain the Minister’s collection activity to the amount of “profit” stated in the notice of confirmation he received in response to his notice of objection. Both parties admitted that the “profit” set out in the notice of confirmation was an error and did not reflect the assessment under appeal in the Tax Court. The Federal Court dismissed the application for judicial review as being a collateral attack on the decision of the Tax Court. Mr. Karam appealed to the Federal Court of Appeal which dismissed the appeal from the bench with costs.
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McGillivray Restaurant v. R. - TCC: Associated corporation appeal dismissed - de facto control by spouse

Apr 08, 2016 By Bill Innes

Précis: This is an appeal of a decision reported earlier on this site. McGillivray Restaurant Ltd. (the “Company”) was incorporated to operate a Keg restaurant franchise in Winnipeg. The majority shareholder of the Company was Mrs. Howard. Her husband managed the Company. He owned two other Keg franchises and was instrumental in obtaining the Company’s franchise. The Tax Court held that he exercised de facto control of the Company making it associated with corporations owned by him for the purposes of the small business deduction. The Company appealed to the Federal Court of Appeal.
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Iqbal v. R. - TCC: No GST/HST New Housing Rebate on 3 month property flip

Apr 07, 2016 By Bill Innes

Précis: Mr. Iqbal was assessed deying him a GST/HST New Housing Rebate for a property the “Elbern Property”) that he held for 3 months in 2011 before selling it. At the date he purchased, and later sold, the Elbern Property he owned a home (the “Blackmere Property) which he had purchased in 2005 and in which he continued to reside in at the date of the Tax Court trial.
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Familamiri v. R. - FCA: Taxpayer’s management fees not exempt from GST

Apr 07, 2016 By Bill Innes

Précis: The taxpayer was assessed GST, interest and penalties on management fees paid to him by 494743 B.C. Ltd. (the "Company") over a 6 year period from 2005 to 2010. He argued that he had entered into an agreement with the Company in 2002, with the consent of CRA, that he would not charge GST on the management fees. He was unsuccessful in the Tax Court and appealed to The Federal Court of Appeal. The Court of Appeal rejected his contention that there was an enforceable agreement that he did not have to pay GST. His appeal was dismissed from the bench, with costs set at $1,000 all inclusive.
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Korfage v. R. - TCC: Minister entitled to use 2010 currency conversion rate, not running average

Apr 06, 2016 By Bill Innes

Précis: This is an extremely esoteric case. The taxpayer was entitled to a US$12,024 exemption in 2010 on a pension received from the International Civil Aviation Organization. The entire issue before the Court was whether the rate of exchange to be applied in determining the amount of that exemption was the 2010 average exchange rate (which was used by the Minister) or an average rate for the 36 month period prior to and including September 2000 (as contended by the taxpayer). The Court concluded that the Minister’s approach was appropriate and dismissed the appeal. There was no order as to costs since this was an informal procedure appeal.
Korfage v. R. - TCC: Minister entitled to use 2010 currency conversion rate, not running averageREAD MORE »

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