David is a tax litigator who specializes in challenging adverse tax reassessments issued by the Canada Revenue Agency.
His Philosophy
An English judge once wrote that “every person is entitled to order his (or her) affairs so that the tax is less than it otherwise would be. If they succeed, then, however unappreciative the [tax agency] or fellow taxpayers may be of their ingenuity, they cannot be compelled to pay an increased tax.”
The above quote reflects David’s philosophy. The Canada Revenue Agency (CRA) can only collect amounts to which it is legally entitled, and no more. He becomes involved when the CRA tries to insist that his clients pay more than required by law.
David is one of the top creative tax problem solvers in the country. He zealously guards the interests of his clients to obtain the best result possible.
His Clients
David’s clients are comprised largely of corporate taxpayers. He also represents high net worth individuals who have been targeted by the CRA. His is experienced in CRA audit management and in defending against CRA challenges to:
- corporate tax planning measures;
- tax loss planning including loss consolidation and non-acquisition of control transactions;
- scientific research and experimental development (SRED) expense challenges;
- gains and losses from non-traditional asset classes such as derivatives and crypto-currencies;
- income, gains or losses from non-Canadian (offshore) assets;
- registered plans including RRSPs, TFSAs and other types of tax-deferred plans (advantage tax, holding non-qualified or prohibited investments, carrying on business in TFSAs, and similar issues);
- tax shelters;
- net worth assessments; and
- capital or income reassessments (for example, real estate and securities).
His Approach
A tax reassessment can be successfully challenged either procedurally or substantively. David successfully uses his knowledge of procedure and administrative law to the advantage of numerous clients without ever having to get to the substantive merits of the reassessment. He has won numerous cases on the basis that income was assessed in the wrong year; or against the wrong taxpayer; or in a statute-barred year; or that the tax law itself was invalid.
A reassessment fought on the merits requires thorough analysis and preparation. There is no substitute for hard work, and he prides himself on his and his team’s ability to prepare a successful defence against a reassessment.
His Professional Experience
David started his career as a tax planner with Thorsteinssons LLP before turning to tax litigation. With a planning background, he understands the tax and commercial foundations of the transactions being challenged.
He has appeared in the Tax Court of Canada on numerous occasions, the Federal Courts of Canada, and the provincial Courts of Ontario and British Columbia. He speaks at tax conferences and for tax groups.
Here is a list of David’s reported cases. For every case on the list, there are two or three others that settled favourably without the need to appear in Court.
His Interests
David enjoys spending time with his family including coaching his boys’ soccer. In his spare time, he searches for the perfect workout regimen, a blend of strength training, HIIT, gymnastics and cardio. He also likes to hike, ski, cycle and play hockey.
Follow David Davies on the Thorsteinssons Tax Blog and on Twitter.
