Tax & Trade Blog

The recent FCA decision, Canada v Chriss (2016 FCA 236), underscores the resignation obligations of directors.  If directors do not execute their resignations properly and completely, they will remain liable for the actions of the corporation, including director’s liability assessments issued by taxing authorities like the Canada Revenue Agency (“CRA”).

In Re Pallen Trust (2015 BCCA 22), the British Columbia Court of Appeal upheld an order for rescission, which effectively nullified a CRA reassessment.

In The Great-West Life Assurance Company v The Queen (2016 FCA 316) [“Great-West Life”], the Federal Court of Appeal upheld the TCC’s decision that services related to processing claims for drug benefits were not financial services, and so not exempt from GST/HST.

Section 141.1(3) of the of Excise Tax Act (“ETA”) broadens the scope of what is considered to be in the course of commercial activities to activity done “in connection with” extraordinary transactions such as starting and winding-up commercial activities.  The Tax Court of Canada (“TCC”), in Onenergy Inc. v. The Queen (2016 TCC 230), discussed how the section should be interpreted.

In order to be successful in tax appeals, the rules of evidence can sometimes play a key role.

In Boroumand, the Appellant appealed assessments for unreported income under the Income Tax Act to the Tax Court of Canada (“TCC”) (2015 TCC 239).  The Appellant’s position was that the funds came from non-taxable sources, including primarily an inheritance from family in Iran. The Appellant sought to introduce documents from money exchange enterprises purporting to show that he received nearly $2 million from Iran. The Minister objected to admitting the documents as they were hearsay and under normal circumstances were inadmissible.