The new trust reporting rules require a trust to provide information about settlors, trustees and beneficiaries. The rules also require a trust to provide information about every person “who has the ability (through the terms of the trust or a…
Trustees and acquisitions of control
Under the Income Tax Act (Canada) (the “Act”),1 the acquisition of control of a corporation can cause a number of unwanted consequences, including a deemed year-end and the restriction or elimination of loss carry forwards. Practitioners need to be aware…
Wilful Blindness
For the purposes of GST gross negligence penalties, a taxpayer will be treated as having made a misrepresentation ‘knowingly’ if the taxpayer was wilfully blind: if the taxpayer had reason to know that he or she should be making inquiries…
Corporate Appellants Need Lawyers
“In Canada v BCS Group Business Services Inc. (2020 FCA 205), the FCA held that a lawyer must represent a corporate appellant in a TCC general procedure appeal.” John Loukidelis “Corporate Appellants Need Lawyers” Tax for the Owner-Manager 21:2 (April…
Inventory adjustment disallowed
In Yorkwest Plumbing Supply Inc. v R, 2020 TCC 122, the Court considered an adjustment of $1.2 million that the taxpayer had made to its 2012 net income in respect of inventory that had been purchased and sold before the…
TIP case
Motter c Agence du revenue du Québec, 2021 QCCA 72, aff’g 2018 QCCQ 3483, found that tenant inducement payments “are not an expense category for the purpose of calculating income from a business or property, nor are they a subcategory…
Series of transactions
In Agence du revenu du Québec c Custeau, 2020 QCCA 1496, the Court considered whether PUC shift and a subsequent reduction of that PUC were part of the same series of transactions such that the Quebec GAAR would apply to…
Post-mortem charitable giving using corporate-owned insurance
Mr X dies owning the shares of Opco. Opco receives a large payout under a life policy it held on X’s life. X’s Will provides for a gift to a charity. How does the estate make the gift using the…
Trusts and Dividends, Again
The CRA believes that a dividend paid to a trust that is then paid to an individual during a year is not allocated until the end of the year (ie December 31 for inter vivos trusts) (CRA technical interpretation 2016-0647621E5,…
QSBCS gains flow through tiered trusts
taxinterpretations.com notes that the CRA, in technical interpretation 2019-0818301I7F (August 13, 2020), has now accepted that a gain realized on the sale of QSBCSs for which an individual could claim the capital gain exemption can be flowed through two levels…