Recent Posts

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  Robichaud v. R. - TCC: Gross negligence penalty affirmed - fictitious business loss

  Feb 04, 2016 By Bill Innes

  Categories:

  • Bill Innes on Current Tax Cases
  • Federal Income Tax
  • Personal Tax, Estate & Wealth Planning

  Précis: Ms. Robichaud claimed a business loss of $354,351.72 in 2008 which she applied to eliminate her taxable income in 2008 and she carried the balance back to 2005, 2006 and 2007. The Minister denied the loss claims and imposed a gross negligence penalty of $46,698.91 in her 2008 taxation year. Mrs. Robichaud had not carried on any business activity in 2008. The only issue in this appeal was the imposition of the penalty.
  Robichaud v. R. - TCC: Gross negligence penalty affirmed - fictitious business lossREAD MORE »
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  Lucyk v. R. - TCC: Court rejects most expense claims in the absence of evidence

  Feb 02, 2016 By Bill Innes

  Categories:

  • Bill Innes on Current Tax Cases
  • Federal Income Tax
  • Personal Tax, Estate & Wealth Planning

  Précis: Mr. Lucyk ran a successful carpet-laying business through a wholly-owned corporation, 101103269 Saskatchewan Ltd. (“101SK”). CRA assessed Mr. Lucyk with respect to various expenses that were paid by 101SK which CRA treated as personal benefits to Mr. Lucyk and his wife. These included car expenses, meals, telephone and other items. Mr. Lucyk appealed to the Tax Court. At trial in the Tax Court the issues were narrowed down to car expenses, meals and telephone. Neither Mr. Lucyk nor his wife testified. The Court largely rejected the claims in the absence of any evidence to rebut the position of CRA. The Court did however allow a de minimus amount, 10%, for corporate use of the home phone.
  Lucyk v. R. - TCC: Court rejects most expense claims in the absence of evidenceREAD MORE »
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  Mason v. R. - FCA: Taxpayer claimed his income earned by others - appeal dismissed from bench

  Feb 01, 2016 By Bill Innes

  Categories:

  • Bill Innes on Current Tax Cases
  • Federal Income Tax
  • Personal Tax, Estate & Wealth Planning

  Précis: The Tax Court decision in Mason was blogged previously on this site. Mr. Mason was an accountant. He argued that the income from his accounting practice was owned by trusts or corporations (the evidence was unclear). He lost in the Tax Court. The Federal Court of Appeal found no reversible error and dismissed his appeal from the bench with costs.
  Mason v. R. - FCA: Taxpayer claimed his income earned by others - appeal dismissed from benchREAD MORE »
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  Kang v. R. - TCC: Indirect audit method accepted for currency exchange business

  Feb 01, 2016 By Bill Innes

  Categories:

  • Bill Innes on Current Tax Cases
  • Federal Income Tax
  • Personal Tax, Estate & Wealth Planning

  Précis: Between them the taxpayers were assessed for more than $3,000,000 in unreported income from a jewellery/currency exchange business in their 2007 taxation years. During a raid more than $2,500,000 in cash in the aggregate was found on their premises. CRA reconstructed their income using an indirect audit method. The Court accepted CRA’s position and the appeals were dismissed with costs.
  Kang v. R. - TCC: Indirect audit method accepted for currency exchange businessREAD MORE »
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  Scheuer v. R. - FCA: CRA has no general duty to warn taxpayers of bad tax shelters

  Jan 29, 2016 By Bill Innes

  Categories:

  • Bill Innes on Current Tax Cases
  • Federal Income Tax
  • Personal Tax, Estate & Wealth Planning

  Précis: In a decision blogged earlier on this site the Federal Court dismissed the Crown’s motion to strike the statement of claim in this case. The plaintiffs are seeking a remedy against the Crown for its negligence in connection with a tax shelter in which they invested. The Crown appealed the Federal Court’s decision to the Federal Court of Appeal. The Court of Appeal recognized that there could be liability in connection with public officials acting “in a manner inconsistent with the proper and valid exercise of their statutory duties, in bad faith or in some other improper fashion” [para. 46] but found that such allegations had not been properly pleaded.
  Scheuer v. R. - FCA: CRA has no general duty to warn taxpayers of bad tax sheltersREAD MORE »
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  Green v. R. - TCC: Business losses not trapped in second level partnership

  Jan 28, 2016 By Bill Innes

  Categories:

  • Bill Innes on Current Tax Cases
  • Federal Income Tax
  • Personal Tax, Estate & Wealth Planning

  Précis: This is a report of a determination of a legal question under section 58 of the Tax Court of Canada Rules (General Procedure). The question at issue was as follows:
  Green v. R. - TCC: Business losses not trapped in second level partnershipREAD MORE »
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  Naraine v. R. - FCA: Taxpayer did not produce evidence of expenses - no reversible error

  Jan 27, 2016 By Bill Innes

  Categories:

  • Bill Innes on Current Tax Cases
  • Federal Income Tax
  • Personal Tax, Estate & Wealth Planning

  Précis: The Tax Court decision in this case was blogged earlier on this site. Mr. Naraine spent 21 years pursuing a remedy against Ford after his employment was terminated. The Tax Court held that the payment he received was taxable either as a retiring allowance or as interest. It also rejected his claim for the deduction of legal fee above the amount of $16,700 allowed by CRA. The Tax Court held that he had not adequately proven such additional legal expenses. Mr. Naraine appealed that finding with respect to legal fees. The Federal Court of Appeal agreed with the Tax Court and dismissed the appeal with costs.
  Naraine v. R. - FCA: Taxpayer did not produce evidence of expenses - no reversible errorREAD MORE »
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  Leibovich v. R. - TCC: Tuition fees at non-specialist school not “medical expenses”

  Jan 22, 2016 By Bill Innes

  Categories:

  • Bill Innes on Current Tax Cases
  • Federal Income Tax
  • Personal Tax, Estate & Wealth Planning

  Précis: The taxpayer’s son had a learning disability and she placed him in a private high school with a good reputation for dealing with such problems. She claimed the tuition expense as a medical expense. CRA denied the deduction of the tuition expense and she appealed to the Tax Court. The Court dismissed the appeal, without costs, on the basis that the school in question did not have programs or equipment specifically addressing the son’s disability. It was a good school, but not a specialist school.
  Leibovich v. R. - TCC: Tuition fees at non-specialist school not “medical expenses”READ MORE »
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  Grenon v. R. - FCA: No deduction for legal fees of child support payor

  Jan 21, 2016 By Bill Innes

  Categories:

  • Bill Innes on Current Tax Cases
  • Federal Income Tax
  • Personal Tax, Estate & Wealth Planning

  Précis: Mr. Grenon sought to deduct legal fees in connection with determining his child support obligations to his ex-wife. The Tax Court dismissed his appeal. The Federal Court of Appeal similarly rejected his appeal holding that an earlier decision of the Court, Nadeau v. M.N.R., 2003 FCA 400, was dispositive of the issue. In addition the Court rejected Mr. Grenon’s arguments based on section 15 of the Charter.
  Grenon v. R. - FCA: No deduction for legal fees of child support payorREAD MORE »
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  Morrison v. R. - TCC: Appellant in test case not entitled to information about others involved

  Jan 18, 2016 By Bill Innes

  Categories:

  • Bill Innes on Current Tax Cases
  • Federal Income Tax
  • Personal Tax, Estate & Wealth Planning

  Précis: The taxpayer’s appeal was one of a number of test cases dealing with donations of pharmaceuticals under tax shelter programs described as the CHT and CGI Donation Programs. In this motion the taxpayer claimed three forms of relief:
  Morrison v. R. - TCC: Appellant in test case not entitled to information about others involvedREAD MORE »