If you buy a home and then change its use, should you always file the 45(3) election to defer any gain? Maybe not, according to James Painter, “Principal-Residence Tax-Deferral Election May Be Inadvisable” (Feb 2016) 6:1 Canadian Tax Focus. Mr…
Employee theft
Mark Tonkovich, “Theft by Owners or Senior Employees: Deductibility of Losses” (Feb 2016) 6:1 Canadian Tax Focus, analyzes employee theft as discussed in Income Tax Folio S3-F9-C1, “Lottery Winnings, Miscellaneous Receipts, and Income (and Losses) from Crime”. The Folio sets…
Section 160 and shareholder benefits
Can the Minister assess a taxpayer under section 160 in respect of an amount already included in the taxpayer’s income under subsection 15(1)? From Justice Bocock, in Parihar v R, 2015 TCC 52 at ¶45: shareholder who has been…
Unpaid income tax and bankruptcy
In Schnier v Canada (Attorney General), 2016 ONCA 5, the Court held that an amount of tax owing (about $4.4 million) was a contingent claim because the relevant assessments were under appeal to the Tax Court. As a result, the…
A simpler T1135
My thanks to Fred Buzzelli, who sent me a link to a good article by Gabe Hayos on the simplified T1135.
Are step children related?
Mr X and Ms Y are common law partners. Each of them has a son from a previous relationship. Are the sons related for the purposes of the Income Tax Act (Canada)? The CRA says “yes” because the step brothers…
Misrepresentation
From Justice Bocock, in Robertson v R, 2015 TCC 246, we read the following regarding whether a mistake of law amounts to a negligent misrepresentation: wise and prudent person is, generally by definition, not unknowledgeable of the law. However,…
No refund for you
A corporate payor doesn’t get a refund if it pays a dividend but fails to file its tax return for the year within three years. But at least RDTOH isn’t reduced either. See Dino Infanti, “FCA Agrees: Dividend Refund Timed…
55(2) This Week
Manu Kakkar and Marissa Halil, in “Subsection 55(2): The CRA’s Recent Positions” Tax for the Owner-Manager 16:1 (January 2016), provide a useful summary of the CRA’s pronouncements on 55(2) at the Tax Foundation conference. The CRA is concerned that deliberately…
Neutral citation for PITA
Carswell is making the Practitioner’s Income Tax Act (PITA) even more useful by switching to neutral citations for its case references. The neutral citation provides a sure-fire way to locate a case quickly and easily, regardless of the database you…