The rules which govern the adversarial trial and appellate process, as distinct from the inquisitorial process, have evolved to help ensure that the issues, as defined by the parties, are decided on the evidence as led by the parties and…
When the Canada-US tax treaty was amended by the Fifth Protocol (effective 2010), new Article IV(7)(b) was added to eliminate treaty benefits for certain hybrid entity arrangements which generated deductions in Canada but no corresponding income pick-up in the US. …
Suppose you disagree with a CRA assessment and appeal the issue to the Tax Court. Suppose you lose the case. And suppose you decide the court is wrong in its reasoning and file your next tax return on the basis…
Simply stated, litigation is the process whereby a legal dispute between parties is resolved by applying the facts to the law. At least in theory, these two factors (facts and law) are to determine the outcome of the dispute and…
On August 11, two women filed a lawsuit against the federal government claiming that certain legislation enacted in response to the Foreign Account Tax Compliance Act (“FATCA”) is unconstitutional. The case has potentially far-reaching effects for the estimated one million…
In 2014-0528021E5, the CRA usefully discussed the taxation of timber limits. Some quick observations:
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In 2014-0536331E5, the CRA ignored a technical timing problem on the liquidation of a foreign affiliate. In the CRA’s view, the deemed disposition of active business assets at fair market value under s. 88(3)(b) should not generate foreign accrual…
Distributions from a partnership in excess of a partner’s basis in its partnership interest can generate a deemed gain to the partner (s. 40(3.1)). In 2011-0417491E5 (recently released) the CRA said that technically such a gain realized by a…
In Inter-Leasing, Inc. v. Ontario (Revenue), 2014 ONCA 575, rev’g 2013 ONSC 2927, the Ontario Court of Appeal (OCA) upheld an internal group financing arrangement which eliminated provincial income tax on interest paid by Alberta-based companies (Alberta Cos) to…
The facts in the recent case of Samaroo v. Canada Revenue Agency, 2014 BCSC 1349 are not complicated. An investigator for CRA obtained a search warrant and the warrant was executed at the plaintiffs’ business and residence. Then CRA reassessed…