As tax advisers, we regularly advise our clients to enter into various legal relationships in order to help them reduce the taxes they would otherwise incur. In providing such advice, however, we would do well to remind our clients that those legal relationships have more than just tax consequences. Rose v. Rose, 81 O.R. (3d) 349, 2006 CanLII 20856 (ON S.C.) could be the cautionary tale.
Tax shelters again
You know it must be the season because the CRA has issued another warning about investing in tax shelters.
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.
PCs and Personal Service Businesses
Under the Income Tax Act (Canada) (the “Act”) significant tax advantages may be available to a professional who derives his or her income through a corporation, of which he or she is both a shareholder and an employee, rather than directly from a practice operated in his or her name.
Good news for CAs
Here is some good news for accountants from last week’s provincial budget: a chartered accountant’s professional corporation will be able to become a member of a limited liability partnership.
Independent Contractors — Or Not?
When is an independent contractor not an independent contractor for the purposes of the Employment Insurance Act (the “EI Act”)? Apparently when the Employment Insurance Commission of Canada makes a regulation that says she isn’t.
OMA Law
Some readers of this newsletter were under the impression that my last article (“OMA Opens Law Firm!”) was intended to applaud the Ontario Medical Association (OMA) for offering to incorporate professional corporations for its members. In fact, our firm has…
OMA Opens Law Firm!
Apparently, the Ontario Medical Association has opened a law firm. It is offering to incorporate professional corporations for doctors for a “nominal” fee ($100 plus disbursements plus GST for a total of $523.90). It is unclear how long this sale will last, so doctors should hurry to take advantage of it before it is too late.
RRSP Mischief
Here’s a depressing case to start off the New Year and take us into the “RRSP season”: Nunn v. The Queen, 2005 TCC 806. The CRA warning about similar schemes, discussed here and here, was apt but too late for…
Medical/Dental PC Regulation Released
Yesterday, Ontario published the regulation that prescribes who can own shares of professional corporations (PCs) controlled by doctors and dentists — see Ontario Regulation 665/05 under the Business Corporations Act (Ontario).