Olympia Trust – Federal Court of Appeal confirms that trustee for self-directed RRSPs was liable for failure to withhold under s. 116

Ryer JA affirmed a finding of Bocock J that a Canadian trust company, which was the trustee for self-directed RRSPs that had purchased shares from non-residents without withholding or receiving s. 116 certificates, was the "purchaser" for s. 116(5) purposes rather than the annuitants, i.e., it was on the hook as the shares were taxable Canadian property. Respecting an alternative argument, that the purchasers for s. 116 purposes were the RRSP trusts themselves, he stated:

[T]he critical element of subsection 116(5) is the paying or crediting of an amount to a Disposing Non-Resident as the purchase price or acquisition cost of the TCP… . This action cannot be taken by a fictional person.

Neal Armstrong. Summary of Olympia Trust Company v. The Queen, 2015 FCA 279 under s. 116(5).