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©2015 Ernst & Young LLP. All rightsreserved.This presentation contains information insummary form, believed to be current as ofthe date of publication, and is intended forgeneral guidance only. It should not beregarded as comprehensive or a substitutefor professional advice. Before taking anyparticular course of action contact EY oranother professional advisor to discuss thesematters in the context of your particularcircumstances. We accept no responsibilityfor any loss or damage occasioned by yourreliance on information contained in thispresentation.
Disclaimer
Tax Knowledge Forum – September 2015
Tax KnowledgeForumSeptember 2015
Page 2
Fraser Gall ─ Moderator
u Fraser is a partner with EY in Toronto and leads the National Tax function which isresponsible for policy, tax knowledge management, communications and practicesupport for the tax practice. He is also president of Ernst & Young ElectronicPublishing Services Inc.
u Fraser was previously the leader of EY’s financial services tax group. He hasextensive experience in many aspects of corporate income tax, including planning,compliance, tax accounting, cross-border issues, and mergers and acquisitions.
Fraser Gall, CPA, CAPartner
Ernst & Young LLP, Toronto
Tel.: +1 416 943 2930 Email: [email protected]
Tax Knowledge Forum – September 2015
Page 3
AgendaLegislative update Yves Plante
CRA administrative update Carolyn Hurst
Recent income tax cases Daniel Sandler
Tax Knowledge Forum – September 2015
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Legislative UpdateYves Plante
Tax Knowledge Forum – September 2015
Page 5
Yves Plante – Legislative update
u Yves is a senior manager with Ernst & Young Electronic Publishing Services Inc. inToronto and member of its editorial board. He is responsible for the analysis andcommunication of emerging tax issues to clients and EY’s tax practice. Yves is also acontributing author, co-author and assistant editor to numerous newsletters andpublications, including EY’s Guide to Income Tax and EY’s Complete Guide toGST/HST.
u With more than 20 years of experience in Canadian corporate and personal incometax, as well as indirect taxes, compliance and consulting, Yves has developed andpresented seminars and training sessions on various areas of tax and on taxresearch and writing.
Yves Plante, CPA, CA
Senior manager
Ernst & Young LLP, Toronto
Tel.: +1 416 943 3529 Email: [email protected]
Tax Knowledge Forum – September 2015
Page 6
Legislative update
► Federal bills and legislative proposals
► Federal legislative consultations
► BEPS developments
► Provincial developments
► Upcoming events
Tax Knowledge Forum – September 2015
Page 7
Federal budget measures
Tax Knowledge Forum – September 2015
Proposals Status EY TaxAlert/News
SubstantivelyEnacted?
Bill C-59, Economic ActionPlan 2015 Act, No. 1
Royal assent23 June 2015
EY N 043-15 Yes(7 May 2015)
Draft legislation• Outstanding 2015 federal
budget measures• Canadian exploration
expenses (CEE)measures (1 March 2015)
Legislative proposals(31 July 2015)
TA 2015-44and
TA 2015-17TA 2015-25TA 2015-26TA 2015-27TA 2015-29TA 2015-30TA 2015-33TA 2015-35
No
Page 8
Federal budget measures
2015 Federal budgetIncome tax measures
Bill C-59 31 July 2015Draft
Legislation
Subsequentlegislativeproposals
Personal income tax measuresu Tax free savings accountu Home accessibility tax creditu RRIFs − minimum withdrawal factorsu Capital gains exemption − qualified farm or
fishing propertyu RDSPs − legal representationu Penalty for repeated failure to report
incomeu Alternative arguments in support of
assessmentsu Information sharing for collection of non-tax
debtsu Transfer of education credits − effect on
family tax cut
üüü
üü
ü
ü
To come
To come
Tax Knowledge Forum – September 2015
Page 9
Federal budget measures
2015 Federal budgetIncome tax measures
Bill C-59 31 July 2015Draft
Legislation
Subsequentlegislativeproposals
Charitiesu Donations of private corporation shares or
real estateu Investments by registered charities in limited
partnershipsu Gifts to foreign charitable foundations
Business income tax measuresu Small business tax rateu CCA − M&P machinery and equipmentu Agricultural cooperatives − deferral of tax on
patronage dividends paid in sharesu Quarterly remitter category for new
employersu Synthetic equity arrangementsu Tax avoidance of corp. capital gains (s. 55)
ü
üüü
ü
ü
ü
üü
Tax Knowledge Forum – September 2015
Page 10
Federal budget measures
2015 Federal budgetIncome tax measures
Bill C-59 31 July 2015Draft
Legislation
Subsequentlegislativeproposals
International taxationu Withholding for non-resident employersu Streamlining reporting requirements for
foreign assets (no legislative changerequired)
u Captive insuranceu Tax planning by multinational enterprises
(BEPS follow-up)u Automatic exchange of information for tax
purposes
GST/HST and Exciseu Alternative arguments in support of
assessmentsu Information sharing for collection of non-tax
debts
ü
üTo come
To come
To come
To come
Tax Knowledge Forum – September 2015
Page 11
Federal NWMMs and bills
Tax Knowledge Forum – September 2015
Proposals Status EY TaxAlert/News
SubstantivelyEnacted?
Bill C-377 – An Act to amend theIncome Tax Act (requirement forlabour organizations)
Royal assent30 June 2015
N/A Yes(16 October 2013)
Bill C-51 – Anti-terrorism Act,2015
Royal assent18 June 2015
N/A Yes(30 January 2015)
NWMM to amend the Excise TaxAct• Feminine hygiene products
NWWM(Adopted 1June 2015)
N/A No
Page 12
Federal NWMMs and bills
Tax Knowledge Forum – September 2015
Proposals Status EY TaxAlert/News
SubstantivelyEnacted?
Bill C-74 – Canada-Quebec Gulf ofSt. Lawrence PetroleumResources AccordImplementation Act
1st reading(House of
Commons)18 June 2015
N/A Yes(18 June 2015)
NWMM to amend the Income TaxAct• Canadian Wheat Board continuance
NWWM(Adopted 17June 2015)
N/A No
Page 13
Other federal outstanding proposals
Tax Knowledge Forum – September 2015
Proposals Status EY TaxAlert/News
SubstantivelyEnacted?
Agriculture and Agri-FoodCanada news release• Prescribed regions for livestock
tax deferrals in 2015
List of designatedregions released
(23 July 2015)
N/A No
Regulations amending theincome tax regulations• Graduated late-filing penalty• Foreign spin-off tax deferral• Reporting requirement re
apprentice-related programsand UCCB
• List of foreign universities
SOR/2015-170Published in Canada
Gazette Part II(1 July 2015)
N/A Yes
Page 14
Other federal outstanding proposals
Tax Knowledge Forum – September 2015
Proposals Status EY TaxAlert/News
SubstantivelyEnacted?
Agriculture and Agri-FoodCanada news release• Prescribed regions for livestock
tax deferrals in 2014
Final list released(28 May 2015)
N/A No
Draft regulations amending theincome tax regulations• Withholding of income tax on
payments from RDSPs
Published in CanadaGazette Part I(9 May 2015)
N/A No
Page 15
Other federal outstanding proposals
Tax Knowledge Forum – September 2015
Proposals Status EY TaxAlert/News
SubstantivelyEnacted?
Legislative proposals (1 March2015)• CEE: environmental studies
and community consultations
Incorporated intothe 31 July 2015
Legislativeproposals
EY TA 2015-17 No
Draft regulations amending theincome tax regulations (19February 2015)• CCA changes for LNG facilities
SOR/2015-117Published in Canada
Gazette Part II(17 June 2015)
EY TA 2015-10 Yes
Page 16
Other federal outstanding proposals
Tax Knowledge Forum – September 2015
Proposals Status EY TaxAlert/News
SubstantivelyEnacted?
Finance News Release 2014-183• 2015 automobile deduction limits
and expense benefit rates forbusiness
SOR/2015-122Published in
Canada GazettePart II
(17 June 2015)
N/A Yes
Proposed regulations amendingthe income tax regulations• Mandatory electronic filing −
Prescribed information returns
SOR/2015-140Published in
Canada GazettePart II
(1 July 2015)
N 119-13 Yes
Page 17
Other federal outstanding proposals
Tax Knowledge Forum – September 2015
Proposals Status EY TaxAlert/News
SubstantivelyEnacted?
Legislative proposals – FinanceNews Release 2013-093FAPI stub period amendment only– for ITA s. 91(all other amendments are eitherpart of Bill C-43 (2014) or ofenacted Bill C-31 (for ITA s.241(9.5))
Legislativeproposals
(12 July 2013)
TA 2013-31 No
Page 18
Federal consultations
Tax Knowledge Forum – September 2015
Topics Status EY TaxAlerts/News
Captive insurance(2015 Federal budget)
Draft legislative proposals released on31 July 2015
EY TA 2015-25EY TA 2015-30
Synthetic equity arrangements(2015 Federal budget)
Draft legislative proposals released on31 July 2015
EY TA 2015-25EY TA 2015-33
Small business deduction: Activeversus investment business(2015 Federal budget)
Consultation opened 21 April 2015(submissions close 31 August 2015)
EY TA 2015-25
Page 19
Federal consultations
Tax Knowledge Forum – September 2015
Topics Status EY TaxAlerts/News
Tax planning by multinationalenterprises(2014 Federal budget)
Consultation paper11 February 2014
(submissions closed 11 June 2014)
TA 2014-10TA 2014-15
Treaty shopping (round 2)(2014 Federal budget)
Consultation paper11 February 2014
(submissions closed 12 April 2014)
Implementation deferred29 August 2014
(Awaiting OECD/G-20 BEPS workrecommendations made in Sept. 2014)
TA 2014-10TA 2014-15
Page 20
Federal consultations
Tax Knowledge Forum – September 2015
Topics Status EY TaxAlerts/News
Eligible capital property(2014 Federal budget)
Legislative proposals to be released forcomments (confirmed in 2015 federal
budget)
TA 2014-10
Non-profit organizations(2014 Federal budget)
Consultation paper to be released forcomments
TA 2014-10
Joint ventures(2014 Federal budget)
Legislative proposals to be released forcomments
TA 2014-10
Page 21
Other federal developments
► Tax treaties
► Canada–New Zealand: Entry into force (26 June 2015)
► Tax information exchange agreements (TIEAs)
► Canada–Cook Islands: Signature (15 June 2015)
► Multilateral Competent Authority Agreement (2 June2015)
► Social security agreements
► Canada–India: Entry into force (1 August 2015)
Tax Knowledge Forum – September 2015
Page 22
BEPS developments
► No discussion draft released
► Release of public comments received for discussion drafts
► Action 6 – Treaty abuse (22 May 2015) EY INT 132-15
► Action 7 – Artificial avoidance of PE status (15 May 2015)EY INT 124-15
► Action 8 – Transfer pricing: hard-to-value intangibles (4 June2015) EY INT 136-15
► Automatic exchange of financial account information: 3documents released (7 August 2015)
Tax Knowledge Forum – September 2015
Page 23
BEPS Developments – Status
Actions DiscussionDraft
Publicconsultation
Report(interim)
Report(final)
1 – Digital economy March 2014 April 2014 Sept. 2014
1 – International VAT guidelines Dec. 2014 Feb. 2015
2 – Hybrid mismatch arrangements March 2014 May 2014 Sept. 2014
3 – CFC rules April 2015 May 2015
4 – Interest deductibility Dec. 2014 Feb. 2015
5 – Harmful tax practices – – Sept. 20146 – Treaty abuse• Revised discussion draft• Follow-up discussion draft• First discussion draft
May 2015Nov. 2014
March 2014
NoneJan. 2015April 2014 Sept. 2014
7 – PE status• Revised discussion draft• First discussion draft
May 2015Oct. 2014
NoneJan. 2015
Tax Knowledge Forum – September 2015
Page 24
BEPS Developments – Status
Actions DiscussionDraft
Publicconsultation
Report(interim)
Report(final)
8-9-10 – Transfer pricingguidelines (TPG) chapter I (incl.,risk, recharacterization, andspecial measures)
Dec. 2014 March 2015
8 – Transfer pricing: intangibles• Hard-to-value intangibles• Cost contribution arrangement
(TPG chapter VIII)
June 2015April 2015
6-7 July 20156-7 July 2015
Sept. 2014
10 – Transfer pricing: other high-risk transactions• Low value-adding intra-group
services (TPG chapter VII)• Cross-border commodity
transactions• Profit splits
Nov. 2014
Dec. 2014
Dec. 2014
March 2015
March 2015
March 2015
Tax Knowledge Forum – September 2015
Page 25
BEPS Developments – Status
Actions DiscussionDraft
Publicconsultation
Report(interim)
Report(final)
11 – Data analysis April 2015 May 201512 – Agressive tax planningarrangements
March 2015 May 2015
13 – Transfer pricingdocumentation and country-by-country (CbC) reporting
Jan. 2014 May 2014 Sept. 2014
Implementationguidance onproposals
(Feb. 2015)
Implementationpackage for CbC
reporting(June 2015)
14 – Dispute resolution Dec. 2014 January 201515 – Multilateral instrumentfor amending tax treaties
– – Sept. 2014
Tax Knowledge Forum – September 2015
Page 26
Provincial developments
► Quebec
► Information Bulletin 2015-4 (18 June 2015)
► Technical changes: e-business development tax credit, film productionservices tax credit, damage insurance tax credit, R&D tax credit
► Harmonization: 2015 and 2014 federal budget measures
► Bill 49 re joint management of St. Lawrence Gulf’s petroleumresources (1st reading: 11 June 2015)
► O.C. 586-2015 re tax evasion and non-reported work (15 July2015)
Tax Knowledge Forum – September 2015
Page 27
Provincial developments
► British Columbia
► Regulation 100/2015 re natural gas tax credit rate increase (5June 2015)
► Regulation 101/2015 re LNG income tax (5 June 2015)
► Regulation 118/2015 re training tax credit prescribed programs (16June 2015)
► Changes to film and television credits re animation productions (26June 2015)
Tax Knowledge Forum – September 2015
Page 28
Provincial developments
► Manitoba
► Regulation 128/2015 re small business venture capital tax creditexpansion (31 July 2015)
► Nova Scotia► Regulation 269/2015 re the digital animation tax credit details and
eligibility (26 June 2015)
► Ontario► ORPP details released (11 August 2015)
Tax Knowledge Forum – September 2015
Page 29
Provincial legislative update – 2015 Budget bills
Jurisdiction Income tax related2015 Budget implementation bills
Status Subst.Enacted
?Alberta An Act to Renew Democracy in Alberta – Bill 1
An Act to Restore Fairness to Public Revenue– Bill 2
Royal assent(29/06/2015)Royal assent(29/06/2015)
Yes
Yes
BritishColumbia
Budget Measures Implementation Act, 2015 –Bill 10
Royal assent(25/03/2015)
Yes
Manitoba The Budget Implementation and Tax StatutesAmendment Act, 2015 – Bill 36
First reading(09/06/2015)
Yes
NewBrunswick
An Act to Amend the New Brunswick IncomeTax Act – Bill 34An Act to Amend the Small Business InvestorTax Credit Act – Bill 35
Royal assent(05/06/2015)Royal assent(05/06/2015)
Yes
Tax Knowledge Forum – September 2015
Page 30
Provincial legislative update – 2015 Budget bills
Jurisdiction Income tax related2015 Budget implementation bills
Status Subst.Enacted
?Newfoundlandand Labrador
An Act to Amend the Income Tax Act, 2000 –Bill 6An Act to Amend the Income Tax Act, 2000,No. 2 – Bill 12
Royal assent(23/06/2015)Royal assent(23/06/2015)
Yes
Yes
NorthwestTerritories
No personal or corporate income tax changes n/a n/a
Nova Scotia Financial Measures (2015) Act – Bill 108 Royal assent(11/05/2015)
Yes
Nunavut No personal or corporate income tax changes n/a n/aOntario Building Ontario Up Act (Budget Measures),
2015 – Bill 91Royal assent(04/06/2015)
Yes
Tax Knowledge Forum – September 2015
Page 31
Provincial legislative update – 2015 Budget bills
Jurisdiction Income tax related2015 Budget implementation bills
Status Subst.Enacted?
Prince EdwardIsland
An Act to Amend the Income Tax Act – Bill8
Royal assent(10/07/2015)
Yes
Quebec No budget implementation bill introduced
Saskatchewan The Income Tax Amendment Act, 2015 –Bill 178
Royal assent(14/05/2015)
Yes
Yukon Act to Amend the Income Tax Act and theYukon Child Benefit Regulation – Bill 86
Royal assent(30/04/2015)
Yes
Tax Knowledge Forum – September 2015
Page 32
Upcoming events
► Federal
► General election: 19 October 2015
► BEPS
► Final reports in time for 8 October 2015 G20 meeting
Tax Knowledge Forum – September 2015
Page 33
Upcoming events
► Alberta
► New budget in fall 2015
► Quebec
► Enactment of outstanding bills (e.g., Bill 13 and Bill 39)
► Taxation review follow-up
Tax Knowledge Forum – September 2015
Page 34
CRA Administrative UpdateCarolyn Hurst
Tax Knowledge Forum – September 2015
Page 35
Carolyn Hurst ─ CRA administrative update
► Carolyn is a senior manager in EY’s Toronto Transaction Tax practice.
► Carolyn’s focus is structuring and implementing public and private mergers,acquisitions, financings and reorganizations in a variety of industries.
Carolyn Hurst, CPA, CA
Senior Manager
Ernst & Young LLP, Toronto
Tel.: +1 416 943 3703 Email: [email protected]
Tax Knowledge Forum – September 2015
Page 36
Agenda
► 2015-0581501C6 – Upstream loans
► 2015-0581611C6 – Foreign affiliates – surplusadjustments
► 2015-0581641C6 – Paragraph 111(4)(e) designations andsection 212.3
► 2014-0529371E5 – T1135 reporting for emigrant
► 2013-0484181E5 – Deemed stock option benefit on death
Tax Knowledge Forum – September 2015
Page 37
2015-0581501C6 – Upstream loans
Issues
► CRA document deals with whether a deduction isavailable under ITA s. 90(9) in three different scenarios.
Tax Knowledge Forum – September 2015
Page 38
2015-0581501C6 – Upstream loans:Scenario 1
Facts
► In 2013, FA made a US$100 loan (“Loan 1”)to Canco.
► FA’s currency for surplus purposes is US$.
► At the “lending time”, FA had exempt surplusand net surplus of US$100.
► In 2014, FA paid a dividend of US$50 at atime it had exempt surplus and net surplusof US$150 (no ITR 5901(2)(b) electionmade).
► Loan 1 is not repaid within 2 years.
► ACB of FA shares is nil.
Tax Knowledge Forum – September 2015
Canco
FA
Loan 1
Page 39
2015-0581501C6 – Upstream loans:Scenario 1
Issues
► In 2014, Canco will have an income inclusion for the C$equivalent (assume C$63) of the US$50 dividend.
► Is Canco able to claim a deduction in each of 2013 and2014 under ITA s. 90(9)(a)(i)(A) for the C$ equivalent(assume C$125) at the “lending time” of Loan 1?
► Will Canco be entitled to a deduction in computing its2014 taxable income of C$63 under ITA s. 113(1)(a)?
Tax Knowledge Forum – September 2015
Page 40
2015-0581501C6 – Upstream loans:Scenario 1CRA’s position► It is consistent with the object and spirit of the upstream
loan rules to allow taxpayers to take a flexible orderingapproach with respect to surplus.
► In this case, the CRA would consider a last-in, first-outordering approach to give an appropriate result.
► Canco would be entitled to a ITA s. 90(9) deduction inboth 2013 and 2014 in respect of Loan 1.
► There is nothing in ITA s. 90 that impacts the availability ofa deduction under ITA s. 113(1); as such, Canco would beentitled to a deduction of C$63 for the dividend received in2014.
Tax Knowledge Forum – September 2015
Page 41
2015-0581501C6 – Upstream loans:Scenario 2
Facts► In 2013, FA made a US$100 loan (“Loan 1”)
to Canco.► FA’s currency for surplus purposes is US$.► At the “lending time”, FA had exempt surplus
of US$100; exempt surplus decreased toUS$60 due to a loss incurred in 2013.
► ACB of FA shares is C$63 as a result ofshare subscription in 2014 (prior todividend).
► In 2014, FA paid a dividend of US$50(C$63) and elects under ITR 5901(2)(b)such that the dividend is deemed to be paidout of pre-acquisition surplus.
► Loan 1 is not repaid within 2 years.
Tax Knowledge Forum – September 2015
Canco
FA
Loan 1
Page 42
2015-0581501C6 – Upstream loans:Scenario 2
Issues
► Is Canco able to claim a deduction in each of 2013 and2014 under ITA s. 90(9)(a)(i)(A) of C$125?
► Is Canco able to claim a deduction in computing its 2014taxable income of C$63 under ITA s. 113(1)(d)?
Tax Knowledge Forum – September 2015
Page 43
2015-0581501C6 – Upstream loans:Scenario 2
CRA’s position► Facts are less sympathetic than in Scenario 1.
► Absent tax avoidance activity, a ITA s. 90(9) deduction ofC$125 would be available in both 2013 and 2014.► Reduction of surplus resulting from a loss is not an event
contemplated in either ITA ss. 90(9)(b) or (c).
► Measure surplus at the dividend time and not any time in asubsequent year in which an ITA s. 90(9) deduction is claimed tooffset a ITA s. 90(12) inclusion.
► The conditions for making an ITR 5901(2)(b) electionwould be met; the provisions of ITA s. 90 in no way affectthe surplus balances of a foreign affiliate.
Tax Knowledge Forum – September 2015
Page 44
2015-0581501C6 – Upstream loans:Scenario 3
Facts
► In 2013, FA made a US$100 loan (“Loan 1”)to Canco.
► At the time of the loan, the ACB of FA sharesis C$63.
► FA made a second loan (“Loan 2”) of US$50in 2014.
► FA’s currency for surplus purposes is US$.
► At the “lending time”, FA had exempt surplusand net surplus of US$100. No additionalsurplus is generated.
► Loan 1 and Loan 2 are not repaid within 2years.
Tax Knowledge Forum – September 2015
Canco
FA
Loan 1
Loan 2
Page 45
2015-0581501C6 – Upstream loans:Scenario 3
Issues
► Is Canco able to claim a deduction of C$125 in 2013 and2014 under ITA s. 90(9)(a)(i)(A) in respect of Loan 1?
► Is Canco able to claim an additional deduction of C$63 in2014 under ITA s. 90(9)(a)(i)(D) on the basis that it couldhave made an election under ITR 5901(2)(b) in respect ofLoan 2?
Tax Knowledge Forum – September 2015
Page 46
2015-0581501C6 – Upstream loans:Scenario 3CRA’s position► Similar to a question addressed at the 2013 IFA
conference re: claiming a notional ITR 5901(2)(b) electionto substantiate a claim under ITA s. 90(9) (see CRAdocument 2013-0483791C6 - Question 5(a)).
► CRA confirmed that a taxpayer would be entitled to rely onITA s. 90(9)(a)(i)(D) if a ITR 5901(2)(b) election wouldhave been available had the notional dividend been a realdividend.
► Canco would be entitled to a deduction of C$63 under ITAs. 90(9) by virtue of ITA s. 90(9)(a)(i)(D).
► Canco may continue to rely on ITA s. 90(9)(a)(i)(A) inrespect of Loan 1.
Tax Knowledge Forum – September 2015
Page 47
2015-0581611C6 – Foreign affiliates –Surplus adjustments
Issue► Whether a deficit in a foreign affiliate that ceases to exist
in an absorptive merger reduces both the surplusaccounts of a merged affiliate and a subsidiary affiliate.
Tax Knowledge Forum – September 2015
Page 48
2015-0581611C6 – Foreign affiliates –Surplus adjustments
Facts
► FA1 and FA2 merge to form “Merged FA”.
► Upon the merger, FA2 ceases to exist.
► Merger qualifies as a “foreign merger” asdefined in ITA s. 87(8.1).
► Immediately prior to the merger:
► FA1 had exempt surplus of $200
► FA2 had an exempt deficit of $125
► FA3 had exempt surplus of $150
► Shares of FA3 become shares of Merged FAas a result of the merger.
Tax Knowledge Forum – September 2015
Canco
FA1
FA2
FA3
Page 49
2015-0581611C6 – Foreign affiliates –Surplus adjustments
► ITR 5905(3) ‒ Opening surplus balances of Merged FAequals the total surplus balances of the predecessorcorporations immediately before the merger.
► Reg. 5905(7.2) ‒ Applies when an upper-tier foreignaffiliate has an exempt deficit and any shares of a lowertier foreign affiliate in the same corporate chain areacquired by the corporation or by another foreign affiliateof the corporation. ITR 5905(7.2) results in the reductionof the exempt surplus balance of the lower-tier affiliate,and the reduction of the exempt deficit balance of theupper-tier affiliate.
Tax Knowledge Forum – September 2015
Page 50
2015-0581611C6 – Foreign affiliates –Surplus adjustments
CRA’s position
► Intended that the adjustment to the deficit of FA2 underITR 5905(7.2) should have effect before the operation ofITR 5905(3).
► The exempt deficit of FA2 would be reduced by $125.
► The exempt surplus of FA3 would be reduced to $25.
► Merged FA's opening exempt surplus is $200.
Tax Knowledge Forum – September 2015
Page 51
2015-0581641C6 ‒ Paragraph 111(4)(e)designations and section 212.3
Issue► Whether a designation made pursuant to ITA s. 111(4)(e)
results in the application of the foreign affiliate dumpingrules in ITA s. 212.3.
Tax Knowledge Forum – September 2015
Page 52
2015-0581641C6 ‒ Paragraph 111(4)(e)designations and section 212.3
Facts
► Canco was controlled by a non-resident corporation suchthat it was a foreign controlled corporation resident inCanada (“CRIC”).
► Canco held the common shares of an FA.
► Control of Canco was acquired.
► Following the AOC, Canco made a ITA s. 111(4)(e)designation in respect of the common shares of the FAsuch that Canco was deemed to have disposed of, andreacquired, the FA shares immediately before the AOC.
Tax Knowledge Forum – September 2015
Page 53
2015-0581641C6 ‒ Paragraph 111(4)(e)designations and section 212.3
CRA’s position
► The deemed reacquisition of the FA would constitute an“investment in a subject corporation made by a CRIC” asdescribed in ITA s. 212.3(10)(a).
► The exception described in ITA s. 212.3(18)(a) would notapply given that the CRIC would not be related to itself.
► Conditions in ITA s. 212.3(1)(b) would be met, and (to theextent that ITA s. 212.3(16) would not apply) ITA s.212.3(2)(a) would apply to deem a dividend to be paid bythe foreign controlled CRIC to its old parent.
Tax Knowledge Forum – September 2015
Page 54
2015-0581641C6 ‒ Paragraph 111(4)(e)designations and section 212.3CRA’s position
► However, the CRA’s view is that the amount of thedeemed dividend would be equal to nil.
► ITA s. 212.3(2)(a) would be read to conclude that thedeemed reacquisition of the shares of a subjectcorporation by a CRIC would result in no amount of adeemed dividend being paid by a CRIC to a parent.
► The deemed disposition and reacquisition of sharespursuant to ITA s. 111(4)(e) would not constitute a transferof any property by the CRIC for purposes of ITA s.212.3(2)(a), and would not constitute any of the otheramounts referred to in ITA s. 212.3(2)(a).
Tax Knowledge Forum – September 2015
Page 55
2014-0529371E5 – T1135 reporting foremigrant
Issues
► Do individuals who emigrate during the year have tocomplete the T1135 based on the calendar year or on theperiod up to the date of emigration?
► Whether or not an individual must report specified foreignproperty that was acquired after emigration but before theend of the taxation year.
Tax Knowledge Forum – September 2015
Page 56
2014-0529371E5 – T1135 reporting foremigrant
CRA’s position► CRA will require the emigrant’s specified foreign property
information only for the part of the year during which theindividual is resident in Canada, even though the Actallows the CRA to collect this information for the fullcalendar year.
► Not required to include on Form T1135 information withrespect to property acquired after the date of emigration.
► Where ITA s. 128.1 applies to deem the individual to havedisposed of the property immediately prior to emigrating,the property’s cost amount at the end of the taxation yearwould be recorded as nil.
Tax Knowledge Forum – September 2015
Page 57
2013-0484181E5 – Deemed stock optionbenefit on death
Issue
► Whether an election under ITA s. 110(1.1) may be madeby an employer in a situation where ITA s. 7(1)(e) appliesafter 4 March 2010.
Tax Knowledge Forum – September 2015
Page 58
2013-0484181E5 – Deemed stock optionbenefit on death
CRA’s position
► CRA now accepts that an election may be made pursuantto ITA s. 110(1.1) to allow a deduction pursuant to ITA s.110(1)(d) where ITA s. 7(1)(e) applies (and the otherconditions of ITA s. 110(1)(d) are met).
► Previously, the CRA stated (docs. 2011-0423441E5 and2009-0327221I7), that the deduction under ITA s.110(1)(d) could not be claimed where the taxable benefitis deemed to have been received by the deceasedemployee under ITA s. 7(1)(e), even if the deceased’sestate or a beneficiary of the estate subsequentlyexercised the option and acquired the securities.
Tax Knowledge Forum – September 2015
Page 59
Current casesDaniel Sandler
Tax Knowledge Forum – September 2015
Page 60
Daniel Sandler ─ Current cases
► Daniel’s practice at Couzin Taylor LLP focuses primarily on tax litigation, representing clients indisputes with the Canada Revenue Agency and the Ontario Ministry of Finance and before thecourts. Prior to joining Couzin Taylor, Daniel was a law professor at Western University and theUniversity of Cambridge. He has served as a consultant to the OECD, the Auditor-General ofCanada, and the Technical Committee on Business Taxation.
► He has written several books and numerous articles and spoken worldwide on various aspects oftax law and policy.
Daniel Sandler
Partner
Couzin Taylor LLP, Toronto
Tel.: +1 416 943 4434 Email: [email protected]
Tax Knowledge Forum – September 2015
Page 61
Recent cases – Agenda
Tax Knowledge Forum – September 2015
►Demand for UTP working papers ‒ MNR v BP CanadaEnergy Company, 2015 FC 714
►Characterization of car lease payments ‒ GMAC LeasecoCorporation v The Queen, 2015 TCC 146
►Third party penalties ‒ Guindon v The Queen, 2015 SCC 41
►QSBC shares ‒ Pellerin v The Queen, 2015 TCC 130
►Implied waiver ‒ Remtilla v The Queen, 2015 TCC 200
Page 62
MNR v BP Canada Energy Company,2015 FC 714 – Overview
► Application by MNR under ITA s. 231.7 to compelthe taxpayer, a publicly traded company, to disclose itsUTP working papers
Tax Knowledge Forum – September 2015
Page 63
BP Canada – Facts
► Taxpayer is a public corporation and is auditedby the CRA on an annual basis as part of its large fileaudits
► MNR requested taxpayer’s unredacted UTP workingpapers (the “Issues Lists”) in the course of its audit of the2005-2007 taxation years in order to assist in the audit ofthose years and subsequent years
► Taxpayer argued that the Issues Lists set out thesubjective assessment by the taxpayer of its uncertain taxpositions and while the ITA requires self-assessment oftaxes, it does not require self-audit
Tax Knowledge Forum – September 2015
Page 64
BP Canada – Issues
► MNR and the taxpayer agreed that the Issues Listsprovides a “roadmap” to target audit resources on issuesof concern
► Can the Minister compel the disclosure of UTPworking papers to assist in future audits?
► Should the Court exercise discretion not to compeldisclosure?
► Is the demand for disclosure unfair to the taxpayer?
Tax Knowledge Forum – September 2015
Page 65
BP Canada – Reasons
► Even though the Minister may not need theIssues Lists to conduct its audit, it wanted them toexpedite the audit process (current and future)
► The Issues Lists were prepared by the taxpayer. Theirdisclosure is not a form of “self-audit”
► Even though the Issues Lists were required to beprepared under authority other than the ITA (i.e., as apublic corporation as part of preparing its audited financialstatements), they are an important tax record
► The Issues Lists relate to accountability under the ITA andamounts payable under the ITA
Tax Knowledge Forum – September 2015
Page 66
BP Canada – Reasons
► MNR’s conduct did not amount to bad faith.It was made in the course of an audit and there was noevidence of a deliberate attempt to mislead the taxpayer
► The fact that not all taxpayers are required to prepare taxaccrual working papers does not amount to inequitabletreatment of this taxpayer
► The disclosure is necessary so that the CRA can discoverand scrutinize in a timely manner the uncertain taxpositions taken by the taxpayer
Tax Knowledge Forum – September 2015
Page 67
BP Canada – Lessons learned
► UTP working papers, like any other document preparedby a taxpayer, may require disclosure to the CRA (subjectto solicitor-client privilege)
► Interesting to see whether the CRA will broaden its policyto request UTP working papers as a matter of course
► Query whether the CRA’s requests will extend to auditor’sUTP working papers
► Taxpayer filed notice of appeal on 3 September 2015
Tax Knowledge Forum – September 2015
Page 68
GMAC Leaseco Corporation vThe Queen, 2015 TCC 146 – Overview
► Characterization to the taxpayer of excesskilometre charges received from car lessees on leasetermination and residual value support payments receivedfrom GM at start of lease
Tax Knowledge Forum – September 2015
Page 69
GMAC Leaseco – Facts
► Taxpayer is in the automobile leasing business
► Lease payments are based on three components:purchase price, residual value and interest rate
► Residual value affected by various factors, but two keyfactors are maximum permitted kilometres and lease’sterm
► Customer cannot negotiate interest rate or residual value
► At end of lease, if customer returns vehicle, taxpayer willimmediately sell it
► Monthly lease payment (simplified) =(purchase price – residual value) x (1 + interest rate)
# months in term
Tax Knowledge Forum – September 2015
Page 70
GMAC Leaseco – Facts
Excess kilometre charge► Customer has choice of low kilometre lease (20,000 km p.a.) or
standard lease (24,000 km p.a.)
► If customer expects to drive more than “standard”, can “buy”additional kilometres in advance at $0.08 per additional km: thetotal cost reduces the car’s residual value (and thereforeincreases lease payments)
► If customer returns vehicle at end of lease with more mileagethan permitted, customer must pay excess kilometre charge($0.12/km for low km lease; $0.10/km for standard lease)
► Taxpayer treated excess kilometre charge as part of proceedsof disposition of leased vehicle (therefore reducing UCC ofclass)
Tax Knowledge Forum – September 2015
Page 71
GMAC Leaseco – Facts
Residual value support payments► In an effort to increase vehicle leases, GM occasionally agreed to
support higher contract residual values (which would reduce leasepayments) and would pay an amount to the taxpayer at the start oflease as compensation
► In 2006, GM and taxpayer were sister corporations: during thisperiod, residual risk payment based on anticipated differencebetween inflated residual value and actual residual value.Taxpayer continued to bear residual risk and kept entire supportpayment even if customer chose to purchase vehicle
► In 2007, ownership changed such that taxpayer at arm’s lengthwith GM. For this year, taxpayer returned support payment ifcustomer purchased vehicle, and if vehicle returned and sold,there was a “true up payment” (i.e., taxpayer did not bear residualrisk)
Tax Knowledge Forum – September 2015
Page 72
GMAC Leaseco – Issues
► Are excess kilometre charges income under ITA s. 9or proceeds of disposition of depreciable property?
► Are residual value support payments income under ITA s.9 or a reduction to the cost (and UCC) of depreciableproperty?
Tax Knowledge Forum – September 2015
Page 73
GMAC Leaseco – Reasons
Excess kilometre charge
► Taxpayer argued that payment was compensation for adecrease in value of the returned vehicle and should be treatedon capital account
► While Court agreed that the payment was compensation foranticipated decrease in the value of the vehicle, it was nodifferent from other factors (residual value or up-front purchaseof additional kilometers) that affected the amount of the leasepayment (which was clearly income under ITA s. 9)
► Taxpayer failed to demolish the CRA’s assumption that theexcess kilometre charge exceeded the actual impact of theexcess kilometres on the car’s value at the end of the lease
Tax Knowledge Forum – September 2015
Page 74
GMAC Leaseco – Reasons
Residual value support payments
► Taxpayer argued payment was income under ITA s. 12(1)(x) asan inducement to purchase the vehicle, but could elect toreduce cost of vehicles under ITA s. 13(7.4)
► According to the Court, these payments were designed toreplace lost leasing income, and therefore income underITA s. 9
► During wholly-owned period, income in year received
► During arm’s length period, income at end of lease after true-up(because no entitlement to keep all or any of the support paymentuntil vehicle sold)
Tax Knowledge Forum – September 2015
Page 75
Guindon v The Queen, 2015 SCC 41 –Overview
► Whether third-party penalties in ITA s. 163.2constitute an offence subject to procedural safeguards ofs. 11 of the Charter
► Whether proceeding is, by its very nature, criminal; or
► Where a “true penal consequence” flows from the sanction
Tax Knowledge Forum – September 2015
Page 76
Guindon – Facts
► Taxpayer was a lawyer practising mainly family lawwith no expertise in tax law
► In 2001, taxpayer was approached by promoters of aleveraged donation program (involving donations of timeshare units) to provide a tax opinion (her fee: $1,000)
► Taxpayer was also the president and administrator of aregistered charity, and in that capacity signed charitabledonation tax receipts in respect of the program
► Scheme was a sham – there were no timeshare units andno transfer to the charity. However, 135 tax receiptssigned by taxpayer for total receipted amount of$3,972,775
Tax Knowledge Forum – September 2015
Page 77
Guindon – Facts
► CRA assessed penalties under ITA s. 163.2(4)totaling $546,747
► Taxpayer successfully appealed to TCC on basis that ITAs. 163.2 contravened s. 11 of the Charter (Courtconcluded that if the penalty was civil, it did apply)
► FCA allowed Crown’s appeal on basis that failure to servenotice of a constitutional question was fatal to TCC’sjurisdiction
► SCC gave taxpayer leave to appeal and statedconstitutional questions; consequently, Attorney Generalof Canada and provincial attorneys general were givennotice of the SCC proceeding
Tax Knowledge Forum – September 2015
Page 78
Guindon – Issues
► Procedural issue: Should the SCC considerconstitutional question notwithstanding that notice of theconstitutional question was not properly given in lowercourts?
► Substantive issue: Does ITA s. 163.2 infringe s. 11 of theCharter (and if so, is the infringement protected by s. 1 ofthe Charter)?
Tax Knowledge Forum – September 2015
Page 79
Guindon – Reasons
► Majority concluded that the Court should exerciseits discretion to consider the substantive Charter question;minority disagreed.
► On substantive issue, the majority concluded:► Proceeding under ITA s. 163.2 was administrative and not
criminal in nature: it did not have the hallmarks of a criminalproceeding; its purpose was to promote honesty and detergross negligence (or worse) in the self-reporting income taxsystem
► Fine under ITA s. 163.2 is not a “true penal consequence”: themagnitude of the fine is in keeping with the nature of themisconduct and necessary to serve the regulatory purpose ofcompliance
Tax Knowledge Forum – September 2015
Page 80
Guindon – Lessons learned
► The penalty under ITA s. 163.2 certainly has teethand fine can significantly exceed fees earned by thirdparty
► Taxpayer can apply for fairness relief under ITA s.220(3.1)
Tax Knowledge Forum – September 2015
Page 81
Pellerin v The Queen, 2015 TCC 130 –Overview
► Whether an infant beneficiary under a trust whosells shares distributed from trust prior to the age of twomeets the 24-month holding period test for QSBC shares
Tax Knowledge Forum – September 2015
Page 82
Pellerin – Facts
► Taxpayer born on 8 March 2007 (conceived inJune 2006)
► In October 2008, family trust distributed shares of a SBCthat it had owned for at least 24 months to the taxpayer,who sold them the following day
► In November 2008, family trust distributed shares ofanother SBC that it had owned for at least 24 months tothe taxpayer, who sold them the following day
Tax Knowledge Forum – September 2015
Page 83
Pellerin – Issue
► Did the shares meet the test in para. (b) of QSBCdefinition in ITA s. 110.6(1), which requires that throughoutthe 24 months prior to the sale, the shares were notowned by anyone other than the taxpayer or a relatedperson?
► Under ITA s. 110.6(14)(c), a trust is deemed to be relatedto any person “for any period throughout which” theperson was a beneficiary of the trust
► Article 5.1 of the trust deed provided that the beneficiariesincluded the children of Mr. Pellerin “from their birth oradoption”
Tax Knowledge Forum – September 2015
Page 84
Pellerin – Reasons
► Jurisprudence interpreting the Civil Code hasheld that legal personality of a child born live and viable isretroactive to the date of conception
► Taxpayer “was retroactively considered a beneficiary,indeed a person, as of his conception for the purposes ofall generally applicable public laws, if that was beneficialfor [the taxpayer]”
► Art. 5.1 of the trust deed cannot be read as inconsistentwith the Civil Code
► Obiter: The “related person” test is determined only at thetransaction date and need not have been maintainedthroughout the 24 months
Tax Knowledge Forum – September 2015
Page 85
Remtilla v The Queen, 2015 TCC 200 –Overview
► Whether T1 adjustment requests constitutean implied waiver for the purposes of ITA s. 152(4)(a)(ii)
Tax Knowledge Forum – September 2015
Page 86
Remtilla – Facts
► Taxpayers bought and sold stock options► In 2005-2007, reported gains/losses on capital account► In 2008 return, reported significant loss on income
account (2009-2010 losses also reported on incomeaccount)
► Taxpayers filed T1 adjustment requests for 2005-2007with 2008 return altering reporting to income account
► CRA reassessed 2008-2010 taxation years denyinglosses on income account
► In 2012, taxpayers negotiated a settlement for all taxationyears on basis that all years on income account and thenclaimed that reassessments of 2006-2007 statute-barred
Tax Knowledge Forum – September 2015
Page 87
Remtilla – Issue
► Did the T1 adjustment requests filed in respect ofthe 2006-2007 taxation years constitute implied waivers?
Note: 2006 and 2007 were years in which the taxpayersreported gains from trading whereas 2005 was a loss year(hence no objection was filed in respect of 2005)
Tax Knowledge Forum – September 2015
Page 88
Remtilla – Reasons
► Although there is a prescribed form for a waiver(T2029), another document may be accepted as a waiverprovided that it has all of the prescribed information and isintended by the taxpayer to be a waiver
► The T1 adjustments included all prescribed information
► Taxpayer fully participated in settlement negotiations andwas represented by counsel: “A reasonable personobserving [the taxpayer’s] interactions with the CRA in2009 and in 2012 would infer that he always intended theT1 Adjustment Requests to be acted upon, even after the2006 and 2007 years became statute-barred.”
Tax Knowledge Forum – September 2015
Page 89
Update on Supreme Court of Canada Cases
Attorney-General of Canadaet al v. Chambre des notairesdu Quebec et al
Privilege - constitutionality of ss.231.2(1), 231.7, 232(1) readvocates and notaries in Quebec
To be heard 3 November2015.
ConocoPhillips CanadaResources Corp. v. MNR
Judicial review - mailing of notice ofassessment
Materials on application forleave submitted to judges.
Guindon v. The Queen Application of third party penalties Appeal dismissed.
The Jean Coutu Group(PJC) Inc. v. AttorneyGeneral of Canada, et al
Rectification - unintended taxconsequences of transaction
Application for leave toappeal filed.
Johnson v. The Queen GST judicial review - assessmentand collection
Leave to appeal dismissed.
Lyrtech RD Inc. v. The Queen CCPC status - s.251(5)(b) andcontingent rights of trustbeneficiaries
Leave to appeal dismissed.
Page 90
Update on Supreme Court of Canada Cases
Martin v. The Queen Costs - award in excess of tariff Application for leave toappeal filed.
MNR v. Thompson Privilege - lawyer's accountsreceivable listing
Heard 4 December 2014.
Page 91
Update on Federal Court of Appeal Cases
0742443 B.C. Ltd. v TheQueen
Business vs property income - boatstorage
To be heard 28 October2015.
1057513 Ontario Inc. v. TheQueen
S. 129(1) dividend refund - filingdeadline
To be heard 28 September2015.
1455257 Ontario Inc. v TheQueen
Motion - whether dissolvedcorporation must be revived tocontinue appeal
Agreement on contents ofappeal book filed 17August 2015.
9016-9202 Quebec Inc. et alv. The Queen
Personal services business -garbage collection workers
Notice of discontinuancefiled 3 June 2015.
9183-4507 Quebec Inc. et alv. The Queen
Jeopardy collection order -piercing of corporate veil
Notice of appeal filed.
The Queen v. Agnico-EagleMines Limited
Foreign exchange gains -conversion of US-denominateddebentures
Requisition for hearingfiled 15 June 2015.
Alceus v. The Queen GST - extension of time to fileobjection to assessment
Notice of discontinuancefiled 26 June 2015.
Page 92
Update on Federal Court of Appeal Cases
Baker v. The Queen RRSP strip - s. 146(9) incomeinclusion
Notice of status reviewfiled 29 June 2015.
Bakorp Management Ltd. v.The Queen
S. 187(2) - "day of payment" forinterest calculation
Requisition for hearingfiled 19 August 2015.
BP Canada EnergyCompany v. MNR
s. 231.2 requirement – tax accrualworking papers
Notice of appeal filed.
The Queen v. BurlingtonResources Finance Companyet al
Transfer pricing - motion to compelCrown to answer discoveryquestions
Requisition for hearingfiled 12 August 2015.
Coast Capital SavingsCredit Union v. The Queen
RRSP strip - whether financialinstitution can base pleadings onsham doctrine
Notice of appeal filed.
The Queen v. David et al Charitable donation - whetherinflated receipt is a benefit thatnegates a gift
Heard 7 May 2015.
Devon Canada Corporation v.The Queen
Notice of objection - largecorporation rules
Heard 9 June 2015.
Page 93
Update on Federal Court of Appeal Cases
The Queen v. Fio Corporation Pre-trial discovery - impliedundertaking rule
Heard 30 April 2015.
The Queen v. Gariepy et al Directors’ liability – effectiveness ofunsigned resignation
Respondent'smemorandum of fact andlaw filed 13 July 2015.
General Motors of CanadaLimited et al v. MNR
Judicial review - retroactive changein calculation method of taxablebenefits
Appeal held in abeyanceuntil 30 October 2015;parties to advise on statusof proposed settlement.
Hedges v. The Queen GST - whether dried marihuanaqualified as a zero-rated supply
Requisition for hearing filed11 June 2015.
Humby et al v. The Queen et al GST - action for damages re CRAcollection actions
To be heard 14 October2015.
Imperial Oil Resources Limitedet al v. Attorney General
Judicial review - whether remissionequivalent to refund of taxoverpayment
Requisition for hearing filed29 April 2015.
Kruger Incorporated v. TheQueen
Foreign exchange contracts -mark to market accounting
Appeal book filed 21August 2015.
Page 94
Update on Federal Court of Appeal Cases
Kruger Wayagamack v. TheQueen
Control - de facto, de jure, anddeemed control
Appellant's memorandumof fact and law filed 10August 2015.
Minister of NationalRevenue v. Lee
Compliance order - properidentification of taxpayer
Notice of appeal filed.
Liu v. The Queen GST - whether taxpayer entitled toGST/HST new housing rebate
Requisition for hearingfiled 10 July 2015.
Marzen Artistic Aluminum Ltd.v. The Queen
Transfer pricing - marketing andsales services
Requisition for hearing filed 6May 2015.
McGillivray Restaurant Ltd. v.The Queen
Small business deduction - de factocontrol of corporation
Requisition for hearing filed27 May 2015.
McKesson CanadaCorporation v. The Queen
Transfer pricing – receivablesfactoring
Request for matter to be heldin abeyance for 90 days filed1 May 2015.
MNR v. McNally Duty to assess "with all duedispatch"
Notice of appeal filed.
Page 95
Update on Federal Court of Appeal Cases
Olympia Trust Company v. TheQueen
S. 116 - whether trustee of self-directed RRSP is "purchaser"
To be heard 2 November2015.
Pareto Corporation et al v.MNR et al
Employee vs. independentcontractor - field sales agents,location scouts and promotionagents
Notice of discontinuancefiled 3 June 2015.
Pépinière A. Massé Inc. v. TheQueen
GST - invoices of accommodation To be heard 14 September2015.
R&D PRO-innovation Inc. v.The Queen
SR&ED - whether food productdevelopment involvedtechnological uncertainty
Notice of appeal filed.
The Queen v. Repsol CanadaLtd.
CCA - whether LNG terminal andjetty qualify as Class 43 assets.
Agreement on contents ofappeal book filed 12 May2015.
The Queen v. Repsol CanadaLtd. et al
Costs - substantial indemnitycosts for fees incurred afterissuance of settlement offer
Agreement on contents ofappeal book filed 13August 2015.
Page 96
Update on Federal Court of Appeal Cases
Revcon Oilfield ConstructorsIncorporated v. MNR
Solicitor-client privilege - taxplanning
Notice of appeal filed.
SCDA (2015) Inc. [StandardLife] v. The Queen
S. 138(11.3) asset bump - whetherlife insurer carrying on business inBermuda
Amended notice of appealfiled 31 July 2015.
Solutions MindReady R&D Incv. The Queen
CCPC status – whether publiccorporation exercised de factocontrol of R&D corporation
Appeal discontinued.
The Queen v. Superior PlusCorp.
Discovery - motion to compeltaxpayer to produce documentscontaining tax advice
Respondent'smemorandum of fact andlaw filed 21 August 2015.
Szymczyk v. The Queen Estoppel - retroactive change incalculation method of taxablebenefits [related to General Motorsappeal - see above]
Appellant's memorandum offact and law filed 29 May2015.
The Queen v. Tallon Medical expenses - travel to warmclimates in winter to reduce chronicpain
Appeal dismissed.
Page 97
Update on Federal Court of Appeal Cases
The TDL Group Corp. v. TheQueen
Interest deductibility - loans fromparent to acquire additionalcommon shares in wholly-ownedUS subsidiary
Appellant's memorandumof fact and law filed 24 July2015.
Page 98
Recent Tax Alerts
EY TaxAlert No.
Title
2015-36 Recaptured input tax credits to be phased out inOntario
2015-37 CRA changes policy for approval of customizedforms
2015-38 Alberta increases corporate and personal incometax rates
2015-39 Prince Edward Island budget 2015–162015-40 CRA requests tax working papers2015-41 Measure to support the BC mining sector comes
into force
Tax Knowledge Forum – September 2015
Page 99
Recent Tax Alerts
EY TaxAlert No.
Title
2015-42 TCC rejects mark-to-market accounting for optioncontracts
2015-43 Quebec: meet the automobile insurance premiumtax remittance deadline
2015-44 Finance releases draft legislation for 2015 budgetand resource-related tax measures
2015-45 More clarification on tax withholding obligations fornonresident employers with frequent businesstravellers to Canada
Tax Knowledge Forum – September 2015
Page 100
Recent Tax Alerts
EY TaxAlert No.
Title
2015-46/47 CRA releases annual APA and MAP programreports
2015-48 Newfoundland and Labrador to raise HST by 2%
Tax Knowledge Forum – September 2015
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