Director’s Liability: Madison v. Canada, 2012 FCA 80 & Canada v. Colitto, 2020 FCA 70
Director's Liability: Madison v. Canada, 2012 FCA 80 & Canada v. Colitto, 2020 FCA 70
When a corporation fails to remit trust amounts such as payroll source deductions, the Canada Revenue Agency’s (“CRA”) recovery options do not end with the company itself. For example, according to section 227.1 of the...
Business vs. Adventure or Concern in the Nature of Trade under the Excise Tax Act
Business vs. Adventure or Concern in the Nature of Trade
“Adventure or concern in the nature of trade” is not defined in the Excise Tax Act, R.S.C., 1985, c. E-15 (“ETA”). In Aviva Canada Inc. (formerly CGU Group Canada Ltd.) v. The Queen, 2006 TCC 57 , the Court held that nothing in the GST/HST scheme requires the phrase...
Personal Services Business (PSB)
Understanding Canada's Personal Services Business (PSB) For Tax Purposes
In Canada, the concept of a Personal Services Business (PSB) under subsection 125(1) of the Income Tax Act, R.S.C., 1985, c. 1 (5th Supp.) (“ITA”) is a critical tax classification that affects incorporated individuals who provide services...
Northwest Hydraulic Consultants Ltd. v. The Queen
In Northwest Hydraulic Consultants Ltd v R, 1998 CarswellNat 696, 98 DTC 1839 , the Tax Court of Canada considered whether certain scientific and technical work conducted by the appellant qualified as scientific research and experimental development (SR&ED) under the Income Tax Act, RSC 1985, c 1 (5th Supp) for the purpose of tax...
Main Rehabilitation Co. v. Canada, 2004 FCA 403
Tax Court of Canada Jurisdiction & Main Rehabilitation Co. v. Canada, 2004 FCA 403
The Tax Court of Canada does not have the jurisdiction to consider issues of abuse of process. Its jurisdiction is limited to determining the correctness of a tax assessment. For example, the Tax Court cannot set aside an assessment...
Choptiany v. The King, 2022 TCC 112
Choptiany v. The King, 2022 TCC 112
The case of Choptiany v. The King, 2022 TCC 112 involved a tax scheme promoted by DeMara Consulting Inc. and Fiscal Arbitrators. It centered on convincing some taxpayers to unwittingly claim fictitious business losses and expenses to create large tax refunds. The Canada Revenue Agency...
Tiered Partnerships & Flow-Through Characteristics
Tiered Partnerships & Flow-Through Characteristics
A tiered or stacked partnership refers to a partnership that owns a partnership interest in another partnership. The Tax Court of Canada (TCC) affirmed the flow-through characteristics of income and losses through a tiered partnership structure in the decision in Devon...