Articles 2021

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Today

Bautista v. the King, 2022-2718(IT)G

  • January 09, 2024
  • Sarah Spaner

In June, the National Post publicized a tax appeal by Toronto sports icon José Bautista. Because the appeal deals with how non-resident, high-income earners save for retirement and protect their income from Canadian taxes, commentators have speculated that a dismissal by the TCC could eliminate certain financial enticements for athletes to play in Canada. This article summarizes the facts and tax issues at stake in this appeal.

Student Forum, Taxation Law

The King v. MMV Capital Partners Inc. — Federal Court of Appeal Applies the GAAR to a Series of Loss Utilization Transactions

  • January 09, 2024
  • Marta Porodko and Lisa Watzinger

In The King v. MMV Capital Partners Inc., the Federal Court of Appeal (FCA) found that the general anti-avoidance rule (GAAR), section 245 of the Income Tax Act (Act), applied to a series of loss utilization transactions. According to the FCA, the transactions were structured to allow a third-party purchaser to access the taxpayer’s losses, and the GAAR applied because the transactions frustrated the object, spirit, and purpose of the loss restriction rules in subsection 111(5) of the Act.

Student Forum, Taxation Law

The Expanded Mandatory Disclosure Rules: An In-Depth Discussion

  • October 13, 2023
  • Michael Ding and Ryan Morris, WeirFoulds LLP, Toronto

The expanded mandatory disclosure rules that came into effect on June 22, 2023 capture a broad range of business transactions and impose reporting obligations on taxpayers, advisors, and promoters. Lawyers should review these rules carefully as non-compliance may result in legal and financial consequences for both themselves and their clients.

Student Forum, Taxation Law

Federal Government Enhances GST Rental Rebate

  • October 13, 2023
  • Kassandra Grenier, Randy Schwartz, Caine Chapman, and Sara Baxter, McCarthy Tétrault

To help address a growing shortage of rental housing, the Canadian government announced, on September 14, 2023, an enhancement to the Goods and Services Tax Rental Rebate, commonly referred to as the landlord’s rebate. The enhanced GST Rental Rebate will provide full relief for the 5% GST paid by builders and purchasers of new purpose-built rental housing.

Student Forum, Taxation Law

Clean Technology Investment Tax Credit

  • October 13, 2023
  • Kevin Yip, Katerina Ignatova, and Brian Cheng, Fasken

On August 4, 2023, the Department of Finance released draft legislation in respect of the clean technology investment tax credit (“Clean Technology ITC”). The Clean Technology ITC allows qualifying taxpayers to claim up to a 30% refundable tax credit on the capital cost of clean technology property. This article discusses the proposed requirements to claim the Clean Technology ITC, including the detailed labour requirements that must be satisfied to obtain the full 30% tax credit.

Student Forum, Taxation Law

Understanding the Section 85 Rollover

  • June 15, 2023
  • Fayme K. Hodal

Relatively speaking, section 85 is not new to Canada’s Income Tax Act.  Even so, as of the date of this writing, section 85 has been discussed, at varying depths, in a mere 314 court decisions; the number of decisions suggests that, once understood, it is likely one of the less obscure sections in the Act.  To this end, as a technically operative section, understanding what is informally known as the section 85 rollover is better done as a disciplined and systematic exercise.

Student Forum, Taxation Law

Strictly Speaking: Separate Corporate Entities in Emergis Inc. v Canada  

  • June 15, 2023
  • Andrea Daly, associate, EY Law LLP

In one of its most recent tax decisions, Emergis Inc. v. Canada, 2023 FCA 78, the Federal Court of Appeal was unwilling to adopt the broad interpretation of the Tax Court of Canada applied to subsection 20(12) of the Income Tax Act regarding foreign non-business income tax.

Student Forum, Taxation Law

Rectification Lives On

  • June 15, 2023
  • Seth Lim, Goodmans LLP

Rectification is an equitable remedy that can be used to correct a written agreement that does not reflect the common intention of the parties. The availability of rectification was significantly curtailed by the Supreme Court of Canada’s decision in Canada (Attorney General) v. Fairmont Hotels Inc., 2016 SCC 56. The article discusses cases that followed and their effect.

Student Forum, Taxation Law