Loss carryovers are an important tool that taxpayers can utilize to reduce their taxable income. When taxpayer incurs a loss, they can use the loss to offset income that would otherwise be taxable. The timing and nature of the loss will affect if and how the taxpayer can utilize...
In 2009, the Tax-Free Savings Account (“TFSA”) program was introduced by the federal government of Canada as a means to allow Canadian families and individuals to more responsibly plan for retirement or significant life purchases. As of 2009, Canadian tax residents over 18 years old have been entitled to...
Overview: Unique Tax Considerations for Shareholder-Employees of a Corporation It is not uncommon within incorporated family businesses or other closely-held private corporations for the shareholders of that business to also act as the employees of the corporation’s business. The concept that a person can be a shareholder, director and...
Introduction: Rectification & Its Tax Consequences Rectification is an equitable remedy. It allows parties to correct drafting errors that would otherwise render a legal instrument incompatible with the agreement that the instrument was meant to document. In these cases, the contracting parties may ask a court to rectify the...
Big box store was ordered by the Federal Court to turn over its client lists to the CRA In November 2022, the Federal Court granted the CRA’s request to force J.D.Irving to turn over its clients’ data from January 1, 2019, which included the complete name, contact information, CRA...
Introduction: The General Anti-Avoidance Rule & Documentary Discovery during Tax Litigation Section 245 of Canada’s Income Tax Act contains the general anti-avoidance rule (also known as the “GAAR”). The GAAR aims to prevent taxpayers from enjoying tax benefits by invoking avoidance transactions that misuse or abuse specific provisions of...
Introduction – What are Statute-Barred Tax Years? The Canadian tax system is based on the principles of self-assessment, which requires that Canadian taxpayers perform their own due diligence and to report their taxable income to the Canada Revenue Agency (“CRA”) for tax assessment. Under subsection 152(1) of the Canadian...
A gift is generally defined as a voluntary and gratuitous transfer of property, without any consideration given in exchange. A personal gift made in Canada may or may not be made on a tax-free basis, depending on the nature of the relationship between parties. A deed of gift can...
Introduction – Digital Payment Services and Financial Reporting Obligations Digital payment services like those offered by PayPal, which are used to facilitate money transfers domestically and internationally, are now well-integrated into our personal and professional lives. Whether your PayPal account is used for genuine commercial purposes, however, or for...
Introduction – T1135s and Beneficial Ownership The Canadian Income Tax Act requires that Canadian tax residents who own “specified foreign property” with a cost of $100,000 or more in Canadian dollars file an annual Foreign Income Verification Statement, or “T1135”, with that year’s tax return. Specified foreign property as...