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In finding that this deduction was not precluded by s. 53 of the same Act, which provided that “[i]n calculating the profits of a trade, no deduction is allowed for items of a capital nature,” Lord Hamblen and Lady Rose accepted (at para. 55) the findings of the First-tier Tribunal that the taxpayers’ “employees operate in a professional services business whose success depends on the availability of skilled and motivated professionals and the grant of share options to those employees is part of their remuneration package” and that the “Debits were … recurring costs that had a connection with the Appellants’ earning of income ….” ...

In connection with finding that the Tax Court lacked jurisdiction under s. 171 to reverse a Ministerial opinion that a requested s. 247(10) downward adjustment is inappropriate given that the jurisdiction accorded to the Tax Court under ITA s. 171(1) is only to vacate or vary an assessment or refer it back to the Minister, whereas a s. 247(10) opinion is not an assessment (although it will affect an assessment), he noted (at para. 74): Anchor Pointe … found that what is under appeal to the Tax Court is the product of the process of determining a taxpayer’s liability under the ITA and not the process itself. ...

Canada, 2022 FCA 115-- summary under Paragraph 250.1(a) Summary Under Tax Topics- Income Tax Act- Section 250.1- Paragraph 250.1(a) s. 250.1(a) did not supersede Oceanspan principle An individual with no connection to Canada paid significant tuition fees while in attendance at U.S. universities prior to 2012 then, on immigrating to Canada, claimed his “unused” tuition tax credits as a deduction from Canadian tax. ...

Canada (Attorney General), 2022 FCA 158-- summary under Subsection 266(2) Summary Under Tax Topics- Income Tax Act- Section 266- Subsection 266(2) FATCA information reporting requirements did not contravene s. 8 of the Charter Woods JA confirmed the rejection by the Federal Court of the position of two American citizens, who had had no significant connection with the U.S. since early childhood, that the information-reporting requirements in ITA Part XVIII (the “Impugned Provisions”) resulted in the unreasonable seizure of financial information belonging to U.S. persons in Canada, contrary to s. 8 of the Charter. ...

HIS MAJESTY THE KING, 2023 FCA 12-- summary under Negligence, Fiduciary Duty and Fault Summary Under Tax Topics- General Concepts- Negligence, Fiduciary Duty and Fault CRA investigation had not breached CRA's duty of care to the taxpayers After a criminal prosecution of the appellants, in connection with allegedly fraudulent SR&ED claims, was stayed, the appellants brought an action in the Federal Court against the Crown for damages based on multiple grounds including a negligent investigation by CRA of their claims (which were found by Barnes J in the Federal Court to have entailed their use of backdated documents). ...

Canada (National Revenue), 2023 FCA 43-- summary under Solicitor-Client Privilege Summary Under Tax Topics- General Concepts- Solicitor-Client Privilege providing a full spreadsheet would not breach privilege The Federal Court had granted a CRA application pursuant to s. 231.7 seeking an order requiring BMO Nesbit Burns (“NBI”) to provide an unredacted version of a spreadsheet in connection with CRA’s audit of suspected dividend rental arrangement transactions of NBI. ...

Canada (National Revenue), 2023 FCA 43-- summary under Section 231.7 Summary Under Tax Topics- Income Tax Act- Section 231.7 an intervening reassessment did not justify a failure to produce requested information The Federal Court had granted a CRA application pursuant to s. 231.7 seeking an order requiring BMO Nesbit Burns (“NBI”) to provide an unredacted version of a spreadsheet in connection with CRA’s audit of suspected dividend rental arrangement transactions of NBI. ...

The King, 2023 TCC 93-- summary under Subsection 169(1) Summary Under Tax Topics- Excise Tax Act- Section 169- Subsection 169(1) costs of Amex’ points program were inputs to its exempt credit card revenues, and did not generate ITCs The Minister denied the input tax credit (“ITC”) claims of Amex Bank of Canada’s (“Amex”) for its 2002 to 2012 taxation years for GST/HST paid on expenses arising in connection with the administration and operation of Amex’s Membership Rewards Program (“MRP”), including expenses (”Reward Expenses”) incurred for the purpose of providing its cardholders who were members of the MRP (“Members”) with rewards on the redemption of points earned by them mostly through making purchases on their cards. ...

Agence du revenu du Québec, 2023 QCCQ 10441-- summary under Farming Summary Under Tax Topics- Income Tax Act- Section 248- Subsection 248(1)- Farming a greenhouse operation is farming, not manufacturing or processing The Quebec manufacturing and processing credits claimed by the taxpayer in connection with equipment acquired for use by it in its greenhouse cucumber-growing operation turned on whether such equipment was Class 29 property. ...

PepsiCo, Inc v Commissioner of Taxation, [2024] FCAFC 86-- summary under Payment & Receipt Summary Under Tax Topics- General Concepts- Payment & Receipt there can be no payment by direction unless there is an antecedent obligation by the creditor to the third party A U.S. company (PepsiCo) entered into an “exclusive bottling appointment” (“EBA”) with an independent Australian bottling company (the “Bottler”) pursuant to which an Australian subsidiary of PepsiCo (the “Seller”) sold concentrate to the Bottler and PepsiCo granted the Bottler the right to use the Pepsi and Mountain Dew trademarks in connection with its sales of the soft drinks. ...