In 2013-0507881E5, the CRA usefully confirmed its view that a payment made pursuant to a valid price adjustment clause – in respect of preferred shares that were redeemed before the payment – is taxed as a dividend in the…
In 2013-0491571E5, the CRA confirmed its view that a “partnership interest” is one property notwithstanding that a partner may hold separate “units” in the partnership. Accordingly, where a partner sells only some of its units in the partnership during…
The Supreme Court of Canada has, in a unanimous judgment rendered by Justice LeBel, ruled in favour of the taxpayers in two tax-related contractual rectification cases arising under the Civil Code of Quebec (Services Environnementaux AES and Riopel).
Both cases…
In Auto Parts Inc. Lecavalier v. The Queen, 2013 CCI 310 (English version not yet available), the Tax Court of Canada (TCC) applied the general anti-avoidance rule (GAAR) to effectively re-characterize a cash share subscription followed by cash debt repayment…
The Federal Court of Appeal (FCA) recently released its reasons in MNR et al v. JP Morgan Asset Management (Canada) Inc.¸ 2013 FCA 250. In lengthy reasons, the FCA takes the opportunity to express its exasperation with the many applicants…
Normally, the CRA cannot collect any amount of reassessed income tax, interest or penalties while the reassessment is under objection or appeal (although CRA can collect half the reassessed amount, if the taxpayer is a large corporation). However, if there…
In the Canadian domestic tax context, an accrued gain on shares held by one Canadian company in another Canadian company may be safely reduced by the payment of an inter-corporate dividend provided the gain so reduced is attributable to underlying…
Is aggressive tax avoidance immoral? Some people think so, but I don’t. (I’ve been on this topic before – see my blog post, June 5, 2013, “Tax Planning, Morality and Cowboys”). The bottom line for me is this: if…
In 2013-0475261E5, the CRA confirmed that a late eligible dividend designation generally should be possible where an excess capital dividend is (later) treated as a taxable dividend. An eligible dividend paid by a Canadian-controlled private corporation (CCPC) is generally…
In 2012-0439741I7 (released October 23, 2013), the CRA’s Sudbury office considered treating a Canadian company’s preferred share investment in a first-tier foreign affiliate as a loan, with the result that tax-free dividends on the preferred shares were proposed to…