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Bakorp Management Ltd. v. R. - TCC: Crown unsuccessful in motion to strike appeal

16 août 2016 By Bill Innes

Précis: This decision involves an appeal from an assessment of the taxpayer’s taxation year ending on March 10, 1992 (the “1992 taxation year”). The taxpayer applied pursuant to subsection 152(4.1) of the Income Tax Act to carry forward non-capital losses to its 1992 taxation year. It filed its return for the 1992 taxation year assuming that the Minister would grant the request but subsequently found that the Minister refused the request and issued an assessment not allowing the losses. The taxpayer duly objected and when the assessment was confirmed appealed to the Tax Court.
Bakorp Management Ltd. v. R. - TCC: Crown unsuccessful in motion to strike appealPlus >

Univ. Laval v. R - TCC: Subsidy from city allowing residents to use sports facilities subject to GST

15 août 2016 By Bill Innes

Précis: Université Laval is a university located in the City of Québec. It commenced plans to expand its sports facilities, Physical Education and Sports Pavilion (PEPS), to meet growing demand. As a part of that expansion it entered into two agreements with the municipality in 2010. The first agreement provided for a $10 million subsidy from the municipality. The second agreement governed usage of the PEPS facilities by municipal residents. CRA treated the $10 million subsidy as consideration for a taxable supply being made by the university to the municipality, i.e., the right to use part of its real property in the form of the PEPS facility. The university argued that the subsidy was a gift without any strings attached and therefore did not involve a taxable supply.
Univ. Laval v. R - TCC: Subsidy from city allowing residents to use sports facilities subject to GSTPlus >

Belzile v. R. - TCC: Taxpayer although related to employer was engaged in insurable employment

15 août 2016 By Bill Innes

Précis: Commencing in April of 2014 Mme Belzile began to work for a landscaping company jointly owned by her, her common-law husband and their daughter. She and the other employees were laid off in October of 2014 (presumably because the business was seasonal). The sole issue was whether the conditions of her employment were similar to those of arm’s length employment. The Tax Court held that they were similar and allowed Mme Belzile’s appeal of the Minister’s decision.
Belzile v. R. - TCC: Taxpayer although related to employer was engaged in insurable employmentPlus >

Bisset v. R. - TCC: Appellant not engaged in insurable employment with her husband’s construction business

12 août 2016 By Bill Innes

Précis: The appellant worked as a bookkeeper for her spouse who ran a small construction business. She had no training as a bookkeeper and relied upon advice from her brother, who was an accountant. She testified that she worked 20 hours per week but had no fixed schedule; she worked from her home. After completing 600 hours (the minimum necessary to entitle her to benefits) she took maternity leave. CRA denied her claim on the basis that she was not engaged in employment similar to arm’s length employment. The Tax Court accepted that CRA’s interpretation of the facts was reasonable and dismissed the appeal.
Bisset v. R. - TCC: Appellant not engaged in insurable employment with her husband’s construction businessPlus >

Coast Capital Savings v. R. - FCA: RRSP Trustee loses appeal of attempt to plead sham

12 août 2016 By Bill Innes

Précis: The taxpayer was the trustee of RRSPs which allegedly acquired taxable Canadian property from a non-resident in the course of what was alleged to be an RRSP strip. It pleaded that the transaction was a “sham” and also pleaded that the “cost” of the purchased property was not the amount it in fact paid. The Minister moved to strike the paragraphs of the Notice of Appeal containing this pleading and she was successful in the Tax Court. The taxpayer appealed to the Federal Court of Appeal which upheld the Tax Court on both points. Costs were awarded to the Minister.
Coast Capital Savings v. R. - FCA: RRSP Trustee loses appeal of attempt to plead shamPlus >

Aimurie v. R. - TCC: Assessment of unreported income based on bank deposit analysis upheld

11 août 2016 By Bill Innes

Précis: Mr. Aimurie operated a tax preparation and cheque cashing business in the years from 2003 to 2010. He reported little or no income from the business. CRA did a bank deposit analysis and concluded that he had significantly under-reported his business income. He was reassessed for these years opening up statute-barred years where necessary and imposing gross negligence penalties. His spouse, Ms. Charles, was also reassessed denying her non-refundable tax credits in respect of Mr. Aimurie in 2008 and 2009 since his income, as reassessed, exceeded the spousal credit threshold. Both appeals were dismissed. There was no order as to costs.
Aimurie v. R. - TCC: Assessment of unreported income based on bank deposit analysis upheldPlus >

Kim v. R. - TCC: Net worth assessments and gross negligence penalties sustained in large part

11 août 2016 By Bill Innes

Précis: Mr. and Mrs. Kim operated a laundry and dry-cleaning business as equal partners. They were reassessed for unreported business income in the 2010 and 2011 taxation years on a net worth basis. Gross negligence penalties were sustained. There was no order as to costs since these were informal procedure appeals.
Kim v. R. - TCC: Net worth assessments and gross negligence penalties sustained in large partPlus >

Pirart v. R. - TCC: Assessment based on income from drug sales sustained in part

10 août 2016 By Bill Innes

Précis: Mr. Pirart was assessed unreported income in the amounts of $1,050,000 for 2005, $1,200,000 for 2006, $1,350,000 for 2007, and $1,500,000 for 2008, mostly from an alleged cocaine business; in addition he was assessed for gross negligence penalties on the unreported income. The Tax Court accepted his evidence that the cocaine was the property of his former partner, Wendy Anderson (since deceased), and allowed the appeal with respect to that income. It dismissed the appeal with respect to his income in the amount of $32,400 from a marihuana business in 2007 and 2008 and sustained the penalties on that unreported income. There was no order as to costs since success was mixed.
Pirart v. R. - TCC: Assessment based on income from drug sales sustained in partPlus >

Margeau v. R. - TCC: Appellant entitled to small amount of Canada Child Tax Benefit

10 août 2016 By Bill Innes

Précis: The taxpayer claimed Canada Child Tax Benefits for both children of her former marriage. CRA denied most of the Benefits on the basis that the taxpayer and her ex-spouse were shared-custody parents during most of the period. In the end it boiled down to a question of credibility and the Tax Court preferred the evidence of the father, i.e., that the children were primarily in his custody during the period in question. The mother was held however to have had sole custody of one of the children during the month of July, 2014.
Margeau v. R. - TCC: Appellant entitled to small amount of Canada Child Tax BenefitPlus >

Copeland v. R. - TCC: Taxpayer liable under subsection 160(1) for transfer from related corporation

9 août 2016 By Bill Innes

Précis: Mr. Copeland received cheques totally $111,000 from a related corporation, Tradepro, at a time when it was a tax debtor. As a result he was assessed under subsection 160(1) for the amount of tax debt of Tradepro at the date of the transfer. Mr. Copeland testified that the cheques were partial repayment of a loan made by his late father (who also used the same middle name, Blaine) to a predecessor corporation of Tradepro and that he held the funds as the agent of his father. Unfortunately for Mr. Copeland the Court did not accept his evidence or that of his bookkeeper and the appeal was dismissed with costs.
Copeland v. R. - TCC: Taxpayer liable under subsection 160(1) for transfer from related corporationPlus >

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