Berg - Federal Court of Appeal finds that a cash-positive transaction is not a gift

The taxpayer issued a bogus promissory note for 90% of the purported value of timeshares units which he purchased and donated to a charity.  In finding that the taxpayer was not entitled to a charitable credit for even the modest value of the donated units, Near JA found that the bogus documents provided to the taxpayer represented a substantial benefit to him (as support for his inflated tax credit claim), so that the donation did not qualify as a gift.

Furthermore, the taxpayer's intent was to "enrich himself" (as the targeted credits exceeded his cash cost, and fees to the promoters) rather than to deplete his property.  This second "cash positive" point will now represent an exception to the general proposition that an intended tax credit claim does not prevent a donation from being a gift.

Neal Armstrong.  Summary of Berg v. The Queen, 2014 FCA 25, under s. 118.1 - total charitable gifts.