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LPC Notes (page 6)

2024 STEP Roundtable

Posted on: September 14, 2024 Last updated on: September 14, 2024 Written by: John Loukidelis
The following is based on the text published in Tax Topics 2713 (September 10, 2024). Question 1 – Spousal Trusts A spousal trust that receives a contribution of capital after the death of the spouse-beneficiary remains a spousal trust, but…
Continue reading “2024 STEP Roundtable”…

Appeal quashed

Posted on: September 6, 2024 Last updated on: September 2, 2024 Written by: John Loukidelis
In Cole v R, 2024 TCC 64, The Appellant spent the better part of ten years trying to convince the Minister of National Revenue to remove over $240,000 added to her taxable income for the 2011 taxation year. Due…
Continue reading “Appeal quashed”…

Demands for information from non-residents

Posted on: September 2, 2024 Last updated on: September 2, 2024 Written by: John Loukidelis
Canada (National Revenue) v. Schreiber, 2024 FC 729, the Federal Court held that, in general, the CRA is entitled to demand information from non-resident persons or entities.
Continue reading “Demands for information from non-residents”…

Dissolved trust year-end

Posted on: July 26, 2024 Last updated on: July 26, 2024 Written by: John Loukidelis
At the 2024 CALU conference round table (question 12, addressed in 2024-1005851C6), the CRA confirmed that a bare trust has a December 31 year-end and that a trust (other than a GRE) that dissolves during a calendar year still has…
Continue reading “Dissolved trust year-end”…

Reassessment outside the normal reassessment period

Posted on: July 24, 2024 Last updated on: July 18, 2024 Written by: John Loukidelis
In Cheema v R, 2024 TCC 81, the Court held that the CRA was entitled to reassess beyond the normal reassessment period where the taxpayer provided no good explanation for a disposition of real property he did not report or…
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Dividends and Section 160 again

Posted on: July 18, 2024 Last updated on: July 18, 2024 Written by: John Loukidelis
In Active Asset Management Inc. v R, 2024 TCC 87, the Court held that neither a deemed dividend arising on a stated capital increase nor a dividend satisfied by a promissory note constituted a transfer of property for the purposes…
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160 and discretionary trusts

Posted on: July 15, 2024 Last updated on: July 15, 2024 Written by: John Loukidelis
Neal Armstrong (taxinterpretations.com) reports that, in Barwicz v R, 2024 CCI 93 (French only), the Court held that, for the purposes of section 160, a beneficiary of a discretionary trust had not given consideration for distributions of capital property from…
Continue reading “160 and discretionary trusts”…

Making Trust Amounts Payable

Posted on: June 27, 2024 Last updated on: June 27, 2024 Written by: John Loukidelis
The CRA has taken the position that a trust cannot deduct an amount made payable to a beneficiary under ITA subsection 104(6) unless, among other things, the trust was legally entitled to make the payment under the terms of its…
Continue reading “Making Trust Amounts Payable”…

Resignation of a director

Posted on: June 17, 2024 Last updated on: June 5, 2024 Written by: John Loukidelis
The result in Ferri v R, 2024 TCC 255, is fact-driven: the court found (at para 25) In these circumstances, there is simply insufficient credible, consistent, reliable evidence to allow the Court to conclude on a balance of probabilities that…
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Section 160 Liability for Indirect Transfers

Posted on: June 13, 2024 Last updated on: June 5, 2024 Written by: John Loukidelis
In Panneton c. R, 2024 CCI 24, the tax debtor husband caused corporations that he owned to pay for renovations on the wife’s residence. The Court held that the payments constituted indirect transfers from the husband to the wife that…
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Post-mortem bumps and capital dividends paid from life insurance

Bump room is determined by the ACB of the target corporation’s shares minus the net tax cost of the underlying assets and the amounts in ITA subparagraph 88(1)(d)(i.1), which include taxable dividends and capital dividends. Accordingly, a target corporation that…
Continue reading “Post-mortem bumps and capital dividends paid from life insurance”…

IBTs and the 88(1)(d) bump

In an intergenerational business transfer (IBT), the purchaser does not generally acquire control of the targetco for the purposes of the rule in ITA paragraph 88(1)(d.2). As a result, the tax cost of the eligible assets of targetco likely cannot…
Continue reading “IBTs and the 88(1)(d) bump”…

No obligation to correct past errors

The CRA believes that a tax adviser should takes steps to ensure their clients correct past errors (I01-1R2 (February 17, 2026), paras. 116-117), but neither the Income Tax Act nor the Excise Tax Act impose such a duty. Other statutes…
Continue reading “No obligation to correct past errors”…

Timing of receipt of dividend on redemption

Under subsection 84(3) of the Income Tax Act (Canada) (the “Act”), where a corporation resident in Canada has redeemed, acquired or cancelled in any manner whatever … any of the shares of any class of its capital stock, (a) the…
Continue reading “Timing of receipt of dividend on redemption”…

GLGI appeals to be struck?

In Kelly v R, 2026 TCC 53, Justice Graham has given multiple taxpayers until April 24, 2026, to provide written submissions on why their appeals should not be struck without a hearing “for abusing this Court’s process”. The taxpayers were…
Continue reading “GLGI appeals to be struck?”…

Recent Posts

Post-mortem bumps and capital dividends paid from life insurance

Bump room is determined by the ACB of the target corporation’s shares minus the net tax cost of the underlying assets and the amounts in ITA subparagraph 88(1)(d)(i.1), which include taxable dividends and capital dividends. Accordingly, a target corporation that…
Continue reading “Post-mortem bumps and capital dividends paid from life insurance”…

IBTs and the 88(1)(d) bump

In an intergenerational business transfer (IBT), the purchaser does not generally acquire control of the targetco for the purposes of the rule in ITA paragraph 88(1)(d.2). As a result, the tax cost of the eligible assets of targetco likely cannot…
Continue reading “IBTs and the 88(1)(d) bump”…

No obligation to correct past errors

The CRA believes that a tax adviser should takes steps to ensure their clients correct past errors (I01-1R2 (February 17, 2026), paras. 116-117), but neither the Income Tax Act nor the Excise Tax Act impose such a duty. Other statutes…
Continue reading “No obligation to correct past errors”…

Timing of receipt of dividend on redemption

Under subsection 84(3) of the Income Tax Act (Canada) (the “Act”), where a corporation resident in Canada has redeemed, acquired or cancelled in any manner whatever … any of the shares of any class of its capital stock, (a) the…
Continue reading “Timing of receipt of dividend on redemption”…

GLGI appeals to be struck?

In Kelly v R, 2026 TCC 53, Justice Graham has given multiple taxpayers until April 24, 2026, to provide written submissions on why their appeals should not be struck without a hearing “for abusing this Court’s process”. The taxpayers were…
Continue reading “GLGI appeals to be struck?”…

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Archives

Categories

Recent Posts

Post-mortem bumps and capital dividends paid from life insurance

Bump room is determined by the ACB of the target corporation’s shares minus the net tax cost of the underlying assets and the amounts in ITA subparagraph 88(1)(d)(i.1), which include taxable dividends and capital dividends. Accordingly, a target corporation that…
Continue reading “Post-mortem bumps and capital dividends paid from life insurance”…

IBTs and the 88(1)(d) bump

In an intergenerational business transfer (IBT), the purchaser does not generally acquire control of the targetco for the purposes of the rule in ITA paragraph 88(1)(d.2). As a result, the tax cost of the eligible assets of targetco likely cannot…
Continue reading “IBTs and the 88(1)(d) bump”…

No obligation to correct past errors

The CRA believes that a tax adviser should takes steps to ensure their clients correct past errors (I01-1R2 (February 17, 2026), paras. 116-117), but neither the Income Tax Act nor the Excise Tax Act impose such a duty. Other statutes…
Continue reading “No obligation to correct past errors”…

Timing of receipt of dividend on redemption

Under subsection 84(3) of the Income Tax Act (Canada) (the “Act”), where a corporation resident in Canada has redeemed, acquired or cancelled in any manner whatever … any of the shares of any class of its capital stock, (a) the…
Continue reading “Timing of receipt of dividend on redemption”…

GLGI appeals to be struck?

In Kelly v R, 2026 TCC 53, Justice Graham has given multiple taxpayers until April 24, 2026, to provide written submissions on why their appeals should not be struck without a hearing “for abusing this Court’s process”. The taxpayers were…
Continue reading “GLGI appeals to be struck?”…

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