Principal Issues: Does subsection 28(5) apply to require an income inclusion where accounts receivable are transferred personally from a farming business operated on the cash basis to a wholly owned corporation in exchange for a note.
Position: Yes.
Reasons: The law. The note received from the corporation represents an amount paid in satisfaction of the taxpayer's disposition of accounts receivable owned personally prior to the transfer.
13(7.1); ITR sched II classes 43.1 and 43.2; 13(5)
Principal Issues: 1. Will solar water heater be eligible for class 43.2 on business use portion where taxpayer receives a grant on personal/residential use.
Position: 2. Depends on facts-- but generally yes
Reasons: 2. as long as all the requirements are met & taxpayer claims CCA on cost net of grant per 13(7.1)
Principal Issues: Whether employer-paid transportation and accommodation expenses for an out-of-town employee in order to allow the employee to attend the employer's social event that is generally available to all employees would result in a taxable benefit?
Could any excess, if any be covered under CRA's policy for gifts and awards.
Position: Question of fact, but possibly not a benefit.
Submitted by narmstrong on Sat, 01/30/2021 - 02:54
full amount of allocated farm loss reduces partnership ACB even if loss restricted under s. 31
A taxpayer who invested $30,000 in a farming limited partnership was thereafter allocated farm losses for the partnership’s first two taxation...
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Principales Questions:
Quel est l'impact d'une perte agricole restreinte sur le PBR d'une participation dans une société en commandite ?
Position Adoptée:
Le PBR de la participation dans la société de personnes d'un contribuable est réduit d'un montant correspondant à sa part dans la perte agricole, compte non tenu de l'article 31 de la Loi. Advenant le cas où le PBR de la participation dans la société de personnes est négatif, un gain en capital sera réputé.
Raisons:
Application de la Loi. Les dispositions de la division 53(2)c)(i)(B) et du paragraphe 40(3.1) de la Loi sont claires et sans ambiguïtés.
Principales Questions: Les règles transitoires applicables aux ententes d'échelonnement du traitement s'appliquent-elles dans une situation donnée?
Position Adoptée: Non
Raisons: Les règles transitoires ne s'appliquent pas pour les services rendus après juin 1986 car rien n'indique que le contribuable a l'obligation de différer la réception d'un montant différé en vertu d'une convention écrite conclue avant le 25 février 1986
et qu'il ne peut pas se soustraire à cette obligation en l'annulant ou autrement.
Submitted by narmstrong on Sat, 01/30/2021 - 18:26
safe income dividend can be included in GRIP if designated as separate dividend
Bco receives, from its wholly-owned subsidiary (Aco), two taxable dividends (the first, designated as an eligible dividend of $3.5 million, for...
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Principal Issues: In a given situation where, in a particular taxation year, Bco receives from its wholly-owned subsidiary (Aco) two taxable dividends (the first, an eligible dividend of $3.5 million and a second of $1.5 million), the two taxable dividends are subject to the application of subsection 55(2), and, Bco has designated the first taxable dividend to be two separate taxable dividends of $3 million (the amount of the safe income on hand attributable to the gain on its shares) and another of $500,000, pursuant to paragraph 55(5)(f), whether Bco could include the first taxable dividend in computing its GRIP even though the said taxable dividend is subject to paragraph 55(2)(a)?
Position: No. Bco could include in its GRIP only $3 million.
Principal Issues: Does 53(2)(h)(i.1)(B)(I) apply when the non-taxable portion of a capital gain is payable and is distributed by a unit trust in the year subsequent to the year that the taxable capital gain was realized and paid to unitholders where those taxable capital gains were designated by the trust under 104(21)?
