Yesterday, the Federal Court of Appeal released its decision in M.N.R. v. Redeemer Foundation, 2006 FCA 325, which overturns the decision of the Federal Court in Redeemer Foundation v. M.N.R., 2005 FC 1361 (see my article on the latter case).
Tax collection agreement
From a Department of Finance press release circulated earlier today: Businesses throughout Ontario will benefit from one tax return, one set of rules and one point of contact as a result of a corporate income tax collection agreement signed today…
Audits and Objections
I have added a new permanent article to the site on audits and objections. A link to the new article can also be found in our sidebar. The article is a sort of prequel to my article on Tax Court…
Yet more on third-party demands
I have written several posts about the difficulties posed for taxpayers and the CRA by subsection 231.2(2) of the Income Tax Act. Earlier this year, the Federal Court released another decision—All Saints Greek Orthodox Church v. M.N.R., 2006 FC 374—relating…
New pages
I have added two new pages to our website that might be of interest to our readers. The first is a collection of links to tax-related websites. The second page simply re-produces an article I posted some time ago on…
Accounting reality
For some reason, the CRA seems to want to believe that an accounting entry by itself is a real transaction that can give rise to tax consequences. The Tax Court, in Cook v. The Queen, 2006 TCC 344 was called on to remind the CRA, again, that an accounting entry as such does not create a taxable reality.
Is GAAR dead?
Perhaps reports of the GAAR’s death—by Brian Arnold among others—have been greatly exaggerated. See Ceco Operations Ltd. v. The Queen, 2006 TCC 256. Apparently, the taxpayer has filed an appeal from Justice Bonner’s decision in favour of the Minister in…
Two cases
The latest CCH Tax Topics contain summaries of two interesting recent cases, one (Truckbase Corporation v. The Queen, 2006 TCC 215) dealing with the deduction of fees paid to amend a shareholder agreement and the other (Canada (Minister of National Revenue) v. Ellingson, 2006 FCA 202) with the powers of the Minister to demand information “where a suspicion exists as to unreported income and illegal activity”.
GAAR and surplus stripping
Not long after the Tax Court released Evans v. The Queen, 2005 TCC 684, it released Archambault, J.’s decision in Desmarais v. The Queen, 2006 TCC 44, which came to a different conclusion about whether GAAR could apply to surplus strips.
Amalgamations, Long and Short
An amalgamation is an important tool in the tax adviser’s toolbox. He or she can use amalgamations to simplify corporate structures, get rid of unwanted shell corporations, permit the interest expense on debt used to acquire another corporation to be deducted in computing income from that corporation’s business or bump the cost of non-depreciable capital property for income tax purposes. Understanding the rules that govern amalgamations, then, is important for a tax practitioner, and an understanding of those rules begins with an understanding of the nature of an amalgamation from a corporate law perspective.