McCague v R, 2025 TCC 59, is another section 160 case where 50/50 shareholders caused their corporation to pay them dividends at a time when it owed taxes. The Court held that section 160 applied and summarized the law in…
Resignation of a director
The result in Ferri v R, 2024 TCC 255, is fact-driven: the court found (at para 25) In these circumstances, there is simply insufficient credible, consistent, reliable evidence to allow the Court to conclude on a balance of probabilities that…
Director due diligence
Jafarnia v R, 2023 TCC 171, restates a hard truth for directors of private corporations: you will not avoid liability for unremitted source deductions if you fail to remit them because you believe the business will turn around and money…
Challenging the underlying assessment
Yesterday, Amit Ummat gave an excellent short presentation about director liability under the Income Tax Act and Excise Tax Act at the HLA’s 16th Corporate-Commercial seminar. He referred to Duque v R, 2020 FCA 73, in which Webb JA said…
Directors must prevent, not correct
In Donaldson v R, 2022 TCC 159, the former director of an invsolvent corporation argued that he had been duly diligent and was not liable for the unremitted source deductions of the corporation. He had met regularly with the CRA…
Director’s resignation
In Zvilna v R, 2022 TCC 50 (informal procedure), the Court accepted the taxpayer’s oral testimony that he had resigned from a corporation in writing even though the document in question was never entered into evidence. The taxpayer and his…
Director liability defence fails
In Burnett v R, 2022 TCC 99, the Court rejected the taxpayer’s due diligence defence of a director liability assessment. It did not matter that the taxpayer was an “outside director” (which the evidence tended to contradict in any case).…
First director resignation ineffective
In Soulliere v R, 2022 FCA 126, the appellant taxpayer had been assessed as a director of a corporation. The appellant was the incorporating director of the corporation, but he purported to resign a few weeks after its incorporation and…
Written Resignation of a Director
In Cliff v Canada, 2022 FCA 16, aff’g an unreported decision of Rossiter, CJ, on other grounds, the appellant argued that she was not liable for the unremitted HST of a corporation as one of its directors because she had…
Section 160 and Director Liability
In R v Colitto, 2020 FCA 70, rev’g 2019 TCC 88, the Court considered when the liability of a director arises under section 227.1 of the Income Tax Act (Canada) (the “Act”) for the purposes of section 160 of the…