| 17 May 2023 IFA Roundtable Q. 1, 2023-0964391C6 - stock based compensation and transfer pricing |
Income Tax Act - Section 7 - Subsection 7(3) - Paragraph 7(3)(b) |
s. 7(3)(b) non-deduction or s. 112(1)(e) deductibility could apply to cross-border stock option recharges of non-resident parent |
| Income Tax Act - Section 247 - New - Subsection 247(2) |
stock-compensation expenses may be relevant to pricing cross-border services charges even where s. 7(3)(b) prohibits their deduction |
| 17 May 2023 IFA Roundtable Q. 2, 2023-0964301C6 - Ukraine Russia FAs and Tax Reporting |
Income Tax Act - Section 233.5 |
failure to file complete information for affiliate in war-torn country |
| Income Tax Act - Section 220 - Subsection 220(2.1) |
potential relief from return-filing requirements re FA in war-torn country |
| 17 May 2023 IFA Roundtable Q. 3, 2023-0964551C6 - T1134 Supplement |
Income Tax Act - Section 233.5 |
T1134 should be timely-filed with missing information noted |
| Income Tax Act - Section 90 - Subsection 90(2) |
a pro rata distribution by an LLLP to its members is a dividend |
| 17 May 2023 IFA Roundtable Q. 4, 2023-0965421C6 - Canada-Barbados Income Tax Convention – “Special Tax Benefit” |
Treaties - Income Tax Conventions - Article 29 |
Class 2 licensees under the Barbados Insurance Act receive a “special tax benefit” for purposes of the Treaty-benefit exclusion |
| 17 May 2023 IFA Roundtable Q. 5, 2023-0965771C6 - Remote Work Arrangements |
Income Tax Act - Section 253 - Paragraph 253(b) |
s. 253(b) does not extend to “invitation to treat” or advertisement |
| Income Tax Act - Section 253 - Paragraph 253(a) |
product development from Canadian home office might engage s. 253(a) |
| Income Tax Act - Section 115 - Subsection 115(1) - Paragraph 115(1)(a) - Subparagraph 115(1)(a)(ii) |
whether Canadian home offices of US employees can give rise to it carrying on business in Canada |
| Treaties - Income Tax Conventions - Article 5 |
whether employee’s home office can constitute a PE of US employer |
| 17 May 2023 IFA Roundtable Q. 6, 2023-0964351C6 - Application of the Canada-US Treaty |
Treaties - Income Tax Conventions - Article 4 |
Treaty benefits could be created for a s. 216 structure by creating partnerships for US purposes |
| 15 September 2020 IFA Roundtable Q. 7, 2020-0853571C6 - Regulation 5901(2)(b) Pre-Acquisition Surplus Election |
Income Tax Regulations - Regulation 5901 - Subsection 5901(2) - Paragraph 5901(2)(b) - Subparagraph 5901(2)(b)(ii) |
Reg. 5901(2)(b)(ii)(A) does not taint a siloed dividend paid by FA to Canco1 even though another Canco holds other FA shares through an LP |
| 17 May 2023 IFA Roundtable Q. 7, 2023-0964521C6 - Application of Article 10, Canada-Hong Kong |
Treaties - Multilateral Instrument - Article 7 - Article 7(1) |
the PPT object and purpose test is met where individuals in a Treaty country transfer their Canco shares to a Treaty-resident Holdco to reduce dividend withholding |
| Treaties - Income Tax Conventions - Article 10 |
violating main purpose test in HK Treaty increases dividend rate/ PPT object and purpose test not violated by using personal holding company in same jurisdiction |
| 17 May 2023 IFA Roundtable Q. 8, 2023-0964561C6 - Tax-free Surplus Balance and Paragraph 88(1)(d) |
Income Tax Act - Section 88 - Subsection 88(1) - Paragraph 88(1)(d) - Subparagraph 88(1)(d)(ii) - Variable C |
surplus computation not required in typical bump and run transaction |
| Income Tax Regulations - Regulation 5905 - Subsection 5905(5.4) |
no surplus calculations needed where FA of Canadian target is acquired by Forco through a Cdn. Buyco and then promptly bumped (under s. 88(1)(d)) and distributed to Forco |
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