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The taxpayer unsuccessfully argued that its change in calculating the consideration for its supplies involved a “decrease in consideration,” so that it could go back more than three years. Lord Legatt stated: What is required … is a change in the consideration actually received by the supplier. … All that has happened is that the taxpayer has had second thoughts about how the consideration received at the time of the supply should be analysed for tax purposes. A similar issue could arise under ETA s. 232, which provides for a potential GST/HST reduction where, after GST/HST has been charged on the consideration for a supply, “for any reason, the consideration … is subsequently reduced.” ...

26 February 2020- 11:34pm Grands Palais – Court of Quebec finds that consideration for parking spots was part of the consideration for (condo) residential complexes for new housing rebate purposes Email this Content The Quebec new housing rebate is essentially the same as the ETA equivalent, except that entitlement to it is lost at a lower dollar level of total consideration for the “residential complex” that is purchased. Croteau, J.C.Q. found that the consideration paid by purchasers for new condo units in a complex also included the $25,000 they paid for an underground parking spot. ... Accordingly, for 93 of the purchases, the total consideration exceeded the dollar threshold, after taking the extra $25,000 into account. ...

25 February 2019- 12:11am CRA indicates that a transfer structured as a sales agreement for nominal consideration may qualify as a gift Email this Content A parent gifted property to a child. A correspondent seemed to assume that this gift was legally required to be effected through an agreement specifying nominal consideration (of $1), with such nominal consideration actually being paid, rather than the gift being effected through a deed of gift. ... For example, if the agreement governing the transfer provides for consideration of $1 merely to ensure that the agreement is legally binding, the CRA may consider the transfer to be a gift. … If it is determined that the transfer of property was a sale for inadequate consideration rather than a gift, paragraph 69(1)(c) would not apply. ...

The ECJ found that this lump sum was taxable “consideration” received by MEO for its services on ordinary principles for VAT purposes, stating: [I]t must be held that the consideration for the amount paid by the customer to MEO is constituted by the customer’s right to benefit from the fulfilment, by MEO, of the obligations under the services contract, even if the customer does not wish to avail himself or cannot avail himself of that right for a reason attributable to him. In Canada, the distinction between consideration received by the supplier of services pursuant to the services contract, and compensation received by it for termination of the contract, is relevant because the latter amount is deemed by ETA s. 182 to be inclusive of GST/HST. ... Autoridade Tributária e Aduaneira, ECLI:EU:C:2018:942 (ECJ (5th Chamber)) under ETA s. 123(1) – consideration. ...

Lamarre ACJ found that CanLII instead was making a taxable supply for which the amounts collected from the Federation were the consideration. She first noted that the ETA definition of “consideration” included any amount that is payable for a supply “by operation of law.” ... V, s. 10 and s. 123(1)- consideration. ...

20 April 2023- 11:48pm CRA finalizes its Memorandum on when transfer payments are taxable consideration Email this Content CRA has finalized its GST/HST Memorandum on the issue of when a governmental or other transfer payment is consideration for a supply, with only very minor changes from the previous draft version. CRA indicates that if there is a direct link between a supply made by the grantee and a transfer payment, the transfer payment is consideration for that supply, and provides various guidelines to assist in that determination. ... Summary of GST/HST Memorandum 18-4 “Determining Whether a Transfer Payment is Consideration For a Supply” June 2022 under ETA s. 123(1) – consideration. ...

CRA considers that a dividend-in-kind of a life insurance policy by a corporation (Aco) to its shareholder is made for no consideration for purposes of s. 148(7)(a)(ii)(B), so that on the dividend-in-kind, the policy was deemed to be disposed of for the greatest of its ACB, CSV and the (nil) consideration received, or $150. However, where a trust transfers the policy to its beneficiary, the beneficiary (Xco) is regarded as giving consideration for the transfer that is all or any part of the beneficiary's income or capital interest, as applicable. Here, it would be reasonable to consider that such consideration had an FMV of $250. ...

The dividend-in-kind of the life insurance policy by a corporation (Aco) to its shareholder is made for no consideration for purposes of s. 148(7)(a)(ii)(B), so that on the dividend-in-kind, the policy is deemed to be disposed of for the greatest of its ACB, CSV and the (nil) consideration received- or $150. However, where a trust transfers the policy to its beneficiary, the beneficiary (Xco) is regarded as giving consideration for the transfer that is all or any part of the beneficiary's income or capital interest in the trust, as applicable. Here, it would be reasonable to consider that such consideration had an FMV of $250. ...

25 October 2021- 1:50am CRA indicates that “consideration … received” in s. 118.1(13)(c) includes a s. 84(3) deemed dividend Email this Content Under s. 118.1(13)(c), where a qualified donee that disposes of non-qualifying securities (“NQS”) that were gifted to it, the amount of the original gift will be deemed in some circumstances to equal the fair market value of the “consideration” received by the donee for that subsequent disposition. CRA indicated that, unless the context indicates otherwise, “the notion of ‘consideration’ is broad enough to encompass any amount, good or service received upon the disposition of property,” so that the “consideration” received by the donee would not be limited to s. 54 proceeds of disposition, and would include a deemed dividend received by the qualified donee under s. 84(3) on a redemption of shares. ...

The Crown itself made what might seem like the opposite argument, namely, that on the redemption by Oldco of its preferred shares held by Newco for a $30 million note, “no consideration was effectively given to Oldco in return.” ... Noël CJ stated that there indeed was consideration going the other way in the form of “Newco in turn … surrender[ing] the shares which had a corresponding $30 million value in its hands.” ... In rejecting the Crown’s submission that the determination as to whether full consideration had been paid by Newco should be determined by the “overall result” produced by the series of transactions, Noël CJ stated that “the adequacy of the consideration given must be measured against the value of the property transferred by way of a ‘snapshot’ taken at the point in time when the transfer takes place.” ...