Articles 2022

Aujourdʼhui
Aujourdʼhui

Glencore: Break Fee Received was “Inducement” Income under Paragraph 12(1)(x)

  • 05 avril 2024
  • Julia Zhuo

In Glencore Canada Corporation v. The Queen (2024 FCA 3), the Federal Court of Appeal (“FCA”) dismissed the taxpayer’s appeal on whether fees related to a failed bid were received on income or capital account. The FCA held that the fees were included in income as an inducement payment pursuant to paragraph 12(1)(x).

Student Forum, Droit fiscal

First TCC Loss-Trading Case Applying Deans Knight

  • 03 avril 2024
  • Sameer Nurmohamed and Ravish Gupta

In Madison Pacific Properties Inc. v The King, the Tax Court of Canada found that the GAAR applied to deny the appellant’s deduction of net capital losses, citing the Supreme Court of Canada’s decision in Deans Knight for the first time in a loss-trading case. Two companies had acted in concert to fundamentally transform the appellant and use non-voting shares to access its losses without acquiring de jure control of the appellant contrary to the object, spirit, and purpose of subsection 111(4).

Student Forum, Droit fiscal

Addressing and Analyzing the CRA’s Guidance Regarding the Tax Consequences of Crypto-Asset Transactions that Occur on Decentralized Finance (DeFi) Lending Protocols

  • 02 avril 2024
  • Jonathan Buckle and Marco Iampieri

This article explores the uncertain income tax consequences facing Canadian taxpayers involved in the lending and borrowing of crypto assets on Decentralized Finance (DeFi) lending protocols. CRA's guidance is urged to be upholstered and increased to mitigate against the risk that taxpayers will incorrectly report and file crypto-asset transactions.

Student Forum, Droit fiscal

Gaudreau c. Le Roi: Advice Provided by Accountants Not Sheltered by Privilege

  • 02 avril 2024
  • Brian Studniberg

The Tax Court of Canada’s decision in Gaudreau c. Le Roi, 2023 CCI 115 (currently under appeal to the FCA), addresses whether a taxpayer may be compelled to produce an accounting firm’s memo in the context of the taxpayer’s examination for discovery. The taxpayer resisted disclosure on the basis that the accounting firm’s memo was not relevant to the CRA’s assessing position. The Tax Court nevertheless concluded that there is no accountant-client privilege and that the memo should be disclosed.

Student Forum, Droit fiscal

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

  • 09 janvier 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, Droit fiscal

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

  • 09 janvier 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, Droit fiscal

The Expanded Mandatory Disclosure Rules: An In-Depth Discussion

  • 13 octobre 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, Droit fiscal

Clean Technology Investment Tax Credit

  • 13 octobre 2023
  • Kevin Yip (Fasken), Katerina Ignatova (Fasken), 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, Droit fiscal

Understanding the Section 85 Rollover

  • 15 juin 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, Droit fiscal