In 2011-0427181E5 (released October 17, 2012), the CRA considered whether a non-resident company would be subject to withholding tax in Canada on a bundled “licence fee” payment from a company resident in Canada in respect of certain computer software…
In The Queen v. Global Equity Fund Ltd., the Federal Court of Appeal (FCA) applied Canada’s general anti-avoidance rule (GAAR) to deny a business loss on the basis that it had no “air of economic or business reality”. The…
Among the many provisions in the October 24, 2012 pending amendments (see http://www.fin.gc.ca/drleg-apl/nwmm-amvm-1012-eng.asp) are rules that clarify the tax treatment of simple pro rata distributions from a foreign affiliate. Although the default rule is that all such distributions are…
Many of my legal colleagues choose not to practice income tax law. According to them, “real lawyers” don’t do tax – tax is something accountants do, not lawyers. I usually choose not to challenge them on this; it’s enough to…
Our obligation as taxpayers to file an accurate return of income has been described by one Tax Court judge as “a bedrock of the tax system.” When a return that accurately reports the taxpayer’s income and deductions has been assessed,…
The Canada Revenue Agency (CRA) has begun issuing assessments to holders of Tax-Free Savings Accounts (TFSAs). So far, we have seen primarily assessments issued under the authority of section 207.05 of Part XI.01 of the Income Tax Act (Canada) in…
On October 24, 2012, the CRA released a technical interpretation which confirmed that no withholding tax applied on commission fees paid to a US insurance broker for certain customer information (2012-0457951E5). Briefly, the facts involved a Canadian insurance broker (Canco)…
On October 24, 2012, Finance released a huge package of technical amendments, many of which have been outstanding for years (see http://www.fin.gc.ca/n12/12-129-eng.asp). The package also included a revised set of rules pertaining to “upstream loans” made by foreign affiliates…
During the week of October 22, 2012, the Tax Court of Canada (TCC) found that Canada’s general anti-avoidance rule (GAAR) did not apply because all the transaction-steps were undertaken primarily for a non-tax purpose (Spruce Credit Union v. The Queen,…
As there is no NHL hockey to watch right now, the second best way to pass the time is to consider the interaction of hockey players and tax. Hockey players, and other professional athletes, have complicated tax lives. They often…