In Roszko v R, 2014 TCC 59, the Court held that amounts received by a participant under notes issued as part of a Ponzi scheme were not income for the purposes of the Income Tax Act (Canada). The Court distinguished…
Inter-company Management Fees
A detailed services agreement was not enough by itself to justify the deduction of management fees paid by Opco to Holdco. The court wanted evidence of the services rendered, the service hours provided, the hourly rate and the identity of…
Providing space
Craig Burley has blogged about 0742443 BC Ltd v R, 2014 TCC 301. His takeaway on the case? “If you have a business that incorporates any sort of rental of space, or allowing customers to use your space, I recommend…
HST diversion
The CRA just tweeted “Is the GST number on your invoice valid? Find out by using the GST/HST registry at http://t.co/LCmyRdCTqQ #GST #HST”. I’ve posted about the registry before, but why would you bother to check? You would care because,…
Tax preparer punishment
Here’s some good news for a change: “Tax preparer given an 18-month conditional sentence and a $377,024 fine for filing false tax returns.” I’ve seen too many cases where unscrupulous preparers file false returns for clueless taxpayers who are left…
PC Income Splitting
Assume that Ms X, a lawyer in Ontario, wishes to incorporate a professional corporation (PC). Unlike her doctor and dentist clients, she can’t permit her husband to subscribe for shares in the capital of the PC because only members of…
Access to information requests
I’ll sometimes make a Privacy Act or access to information request so that I can see the auditor’s or appeals officer’s file (or both). The CRA has published a webpage on how to make such requests, which is a welcome…
Tax “protesting” as crime
The CRA reports that a tax “protester” has been fined for evading tax and sentenced to prison for counselling others to commit fraud (presumably by teaching them tax protester “methods”).
Splitting income for PCs
I’ve written before concerning my doubts about the advisability of issuing shares that are redeemable for a nominal amount but that are entitled to unlimited dividends. Robin MacKnight does not share these concerns: he appears to have no qualms about…
Otteson and the capital gain exemption
The provisions of the Income Tax Act governing when a taxpayer can claim the capital gain exemption in respect of farm property are complex. Otteson v R, 2014 TCC 250, is an interesting case that navigates the provisions in the context of a rather complex set of facts.