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Posts tagged "Income Tax Act"

R. v. Chriss - FCA: Unsigned resignations ineffective
Oct 04, 2016 By Bill Innes
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Précis: The Tax Court decision was blogged earlier on this site under the name Gariepy v. The Crown. The nub of the issue before the Tax Court was whether unsigned directors’ resignations prepared by a corporation’s external lawyers were effective to prevent liability for unpaid corporate remittances. The Tax Court held that they were on the facts of the case. The Federal Court of Appeal reversed that decision in a clear policy decision. A bright line test was necessary and unsigned resignations did not, in the Court of Appeal’s opinion, meet such a test. The Crown’s appeal was allowed with costs in both the Court of Appeal and the Tax Court.
R. v. Chriss - FCA: Unsigned resignations ineffectiveREAD MORE »
Osaduke v. R. - TCC: Unreported income adjusted but penalties sustained on lower amount
Oct 04, 2016 By Bill Innes
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Précis: The taxpayer was audited and the auditor by means of examining bank deposits concluded that he had unreported income in both 2008 and 2009 from the sale of metal and coins and from eBay sales. The Tax Court reduced the unreported income from $62,111 and $46,008 in 2008 and 2009 respectively to $39,488 and $44,425 respectively however it sustained gross negligence penalties on the reduced amounts. There was no award of costs since this was an informal procedure appeal.
Osaduke v. R. - TCC: Unreported income adjusted but penalties sustained on lower amountREAD MORE »
CGI Holdings LLC v. R. - FCt: Mandamus denied, Minister did not act unreasonably or with undue delay
Oct 03, 2016 By Bill Innes
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Précis: In 2007 CGI Holding Inc, a Delaware limited liability corporation (“CGI”), received a dividend of $142 million from its related Canadian resident corporation, 3208170 Nova Scotia Company, as the result of a corporate reorganization. A 25% withholding tax (roughly $35 million) was paid on this dividend. In 2010 the Tax Court released its decision in TD Securities (USA) LLC v The Queen, 2010 TCC 186. CRA subsequently changed its policy as to the treatment of dividends paid to an American LLC where the Canada-US Tax Treaty applied. As a result CGI claimed that the withholding tax on the 2007 dividend should only have been 5%, not 25%, and applied in March of 2012 to CRA for a refund. CRA declined the refund request as being out of time.
CGI Holdings LLC v. R. - FCt: Mandamus denied, Minister did not act unreasonably or with undue delayREAD MORE »
Azzopardi v. R. - TCC: Extension applications a comedy of errors
Oct 03, 2016 By Bill Innes
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Précis: The Azzopardi brothers, Thomas and Emmanuel, were limited partners of the same partnership. They applied to extend the time to file individual notices of appeal or notices of objection for a variety of taxation years. The Crown consented to most of the applications but did not consent to Emmanuel’s application in respect of 2002 because it was a nil assessment. In the case of Thomas’ application for 2011 and 2012 the Crown pointed out that the Court was without jurisdiction because Thomas had failed to apply within the period during which the Court had jurisdiction to grant relief. There were no orders as to costs.
Azzopardi v. R. - TCC: Extension applications a comedy of errorsREAD MORE »
Duguay v. R. - TCC: Donation to charity in exchange for lower rent not a true gift
Sep 30, 2016 By Bill Innes
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Précis: The appellant was living in an apartment owned by a registered charity. He personaly paid for $20,000 in renovations to the apartment. The charity gave him two cheques, each for $10,000 to reimburse his renovation costs. He endorsed one of the cheques back to the charity for which he was issued a $10,000 donation receipt. The receipt was disallowed and he appealed to the Tax Court.
Duguay v. R. - TCC: Donation to charity in exchange for lower rent not a true giftREAD MORE »
van der Steen v. R. - TCC: Unrelated donor to charity could give evidence of donation arrangement
Sep 29, 2016 By Bill Innes
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Précis: This is a decision on two technical procedural points during the course of a trial involving an alleged charitable donation tax scheme. On the first point the Crown was permitted to call an unrelated donor to the same charity to establish the “workings, scope, extent and duration of” the donation arrangement [para. 1]. However the evidence of that donor was not admissible to determine whether the taxpayer had made the disputed donation.
van der Steen v. R. - TCC: Unrelated donor to charity could give evidence of donation arrangementREAD MORE »
Harder v. R. - TCC: Computerized “netted out” support - no tax credits for second child
Sep 22, 2016 By Bill Innes
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Précis: The taxpayer paid an amount to his former spouse which represented a netting of their individual child support obligations for the two children of the marriage (based on their individual levels of income). The calculation was done by their respective lawyers using a program called “Divorce Mate”. Since the taxpayer was the only person paying support he was not entitled to dependent tax credits in respect of one of the children. Both parents could claim dependent tax credits in respect of one child only where both were actually making payments.
Harder v. R. - TCC: Computerized “netted out” support - no tax credits for second childREAD MORE »
Kvas v. R. - TCC: No subsection 160(1) transfer to shareholders from dissolved corporation
Sep 22, 2016 By Bill Innes
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Précis: This case involved the appeals of the Kvas brothers from subsection 160(1) assessments alleging that each of them had received transfers of property on or about December 31, 2008 from Commercial Interior Alterations Inc. (“CIA”), a corporation of which they had been the shareholders. The difficulty was that CIA had been dissolved in January of 2008, i.e., roughly 11 months before the alleged transfers and 6 years before the issuance of the assessments. The Tax Court was asked to determine whether subsection 160(1) assessments could be raised in respect of a transfer from a non-existent entity.
Kvas v. R. - TCC: No subsection 160(1) transfer to shareholders from dissolved corporationREAD MORE »
Borgstadt v. R. - TCC: Taxpayer was shared-custody parent of older autistic child
Sep 15, 2016 By Bill Innes
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Précis: The taxpayer had two teen-aged children, one of whom, the son, was autistic. She claimed that even though her son divided his time between her home and that of her ex-spouse, she bore the brunt of his special needs and should therefore be entitled to a full Canada Child Tax Credit. CRA limited her claim in the case of both children to 50% of the Canada Child Tax Credit and she appealed to the Tax Court in respect of her son.
Borgstadt v. R. - TCC: Taxpayer was shared-custody parent of older autistic childREAD MORE »
1716790 Ontario Inc. v. R. - TCC: Corporate taxpayer must answer questions about a major owner
Sep 12, 2016 By Bill Innes
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Précis: Although this case involves very detailed refusal issues it boils down to whether the corporate taxpayer can be forced to answer questions about a non-majority, but major, shareholder who is alleged in the Crown’s Reply to be its controlling mind. The central issue in the case is whether the corporate taxpayer was in the business of building and selling retirement homes, as was alleged by the Crown, or whether it held the homes as capital property.
1716790 Ontario Inc. v. R. - TCC: Corporate taxpayer must answer questions about a major ownerREAD MORE »

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