Search - consideration

Canada, 2013 FCA 269-- summary under Consideration Summary Under Tax Topics- Excise Tax Act- Section 123- Subsection 123(1)- Consideration "consideration" under law of contract In the course of finding that the appellant was receiving a financial supply from the casinos it contracted with, Sharlow JA stated (at para. 15): In the context of this appeal, the word "consideration" should be understood to mean anything that would be consideration under the law of contract, and "taxable supply" should be understood to include anything supplied in the course of a commercial activity except a "financial service" as defined in subsection 123(1) of the Excise Tax Act. ...

The Queen, 2012 TCC 7-- summary under Consideration Summary Under Tax Topics- Excise Tax Act- Section 123- Subsection 123(1)- Consideration consideration not reduced by credit for subsequent provincial subsidy The appellant was entitled to receive amounts under an Alberta energy assistance program to defray additional costs to users (consumers and businesses) from a spike in natural gas and electricity costs. ... The appellant applied for a GST rebate under s. 261 on the basis that the GST payable by it should reflect consideration net of the credit, and was denied that rebate. ... Words and Phrases consideration ...

Canada, [2002] GSTC 11, 2001 FCA 264-- summary under Consideration Summary Under Tax Topics- Excise Tax Act- Section 123- Subsection 123(1)- Consideration provincial subsidy was paid only if busing services provided The appellant school boards paid GST charges of independent bus companies for their busing services, and were compensated with a Quebec government subsidy (which was not subject to GST due to provincial government immunity). In finding that the school boards were making taxable supplies to the Quebec government, so that they were entitled to full input tax credits, Noël J.A. stated (at paras. 19, 28): [I]n order for a payment to constitute consideration, it must have been made pursuant to a legal obligation (contractual or otherwise) and must be closely enough linked to a supply that it may be regarded as having been made "for" that supply…. ...

He argued that since he had established that around ¼ of the payments received by him as cheques from a corporation, with which he did not deal at arm’s length, properly reimbursed him for business expenses, he had demolished the Minister’s “exact” assumption made in assessing him under s. 160 that the taxpayer had “provided no consideration for the cheques.” In rejecting this position, Monaghan JA stated (at para. 21) that the taxpayer “places far too much emphasis on the word ‘exact’ and gives insufficient weight to the word ‘demolish’ in … Hickman. ” and further stated (at para. 24) that “establishing some consideration for the cheques is not sufficient to demolish the Minister’s assumption,” noting in this regard (at para. 25) that the “purpose of pleading the assumption is to provide the appellant with notice of the case the appellant has to meet” and here, the taxpayer knew that, in the context of a s. 160 assessment, he needed to establish that he had provided fair market consideration for the cheques, “not merely some consideration.” Rather than being bound, by the purported demolishing of the Minister’s assumption, to find that there was full consideration given by the taxpayer for the cheques received by him from Global “it was open to the Tax Court to determine the value of the consideration the appellant gave for the cheques based on all the evidence tendered” (para. 28). ...

On appeal, the taxpayer, in relying (at para. 19) on a statement in Hickman that the “initial onus of ‘demolishing’ the Minister’s exact assumptions is met where the appellant makes out at least a prima facie case,” argued that since he had established that some expenses were properly reimbursed, he had demolished the Minister’s “exact” assumption that the taxpayer had “provided no consideration for the cheques.” ... The appellant knew the case he had to meet—the only issue under section 160 was whether the appellant provided consideration for the payments Global made to him by cheque, which, in the context of section 160, means fair market value consideration, not merely some consideration. Rather than being bound (due to a purported demolishing of the Minister’s assumption) to find that there was full consideration given by the taxpayer for the cheques received by him from Global “it was open to the Tax Court to determine the value of the consideration the appellant gave for the cheques based on all the evidence tendered” (para. 28). ...

Canada, 2013 FCA 269-- summary under Subsection 153(1) Summary Under Tax Topics- Excise Tax Act- Section 153- Subsection 153(1) "consideration" under law of contract In the course of finding that the appellant was receiving a financial supply from the casinos it contracted with, Sharlow JA stated (at para. 15): In the context of this appeal, the word "consideration" should be understood to mean anything that would be consideration under the law of contract, and "taxable supply" should be understood to include anything supplied in the course of a commercial activity except a "financial service" as defined in subsection 123(1) of the Excise Tax Act. ... Words and Phrases consideration ...

Piche transferred such Class C shares to Newco under s. 85(1) in consideration for shares of Newco having an equivalent fair market value (“FMV”). ... In rejecting this submission, Noël CJ stated (at para. 58): [T]he 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. … [I]t is not disputed that Newco gave Oldco adequate consideration at that time …. ... It follows that what was given by Newco as consideration are shares having a value of $30 million. ...

After noting (at para. 4) that "‘consideration' should be understood to include anything that would be consideration under the law of contract," Sharlow JA rejected the primary position of Costco that the amounts received by it from Amex were rebates of the merchant discount fees earned by Amex, noting that it was more consistent with the wording of the Co-Branding Agreement to consider such amounts as consideration for Costco entering into the Co-Branding Agreement or, more specifically, for the exclusivity provision. ... Words and Phrases consideration ...

The Queen, 78 DTC 6272, [1978] CTC 395 (FCA)-- summary under Subsection 15(1) Summary Under Tax Topics- Income Tax Act- Section 15- Subsection 15(1) dividend satsified share purchase consideration The appellant majority shareholder of a company, who agreed to purchase the shares held in the company by a minority shareholder in consideration of having the company first pay a dividend to the minority shareholder of $350,050, was found to have received a benefit of $350,050 in that the payment of the dividend satisfied his obligation to pay the price of the shares. ... The value of what he acquired in consideration of the debt or obligation is really irrelevant". ...

Canada, 2010 FCA 32-- summary under Subsection 160(1) Summary Under Tax Topics- Income Tax Act- Section 160- Subsection 160(1) dividend is a transfer of property without consideration In rejecting a submission that the payment of dividends to the appellant were not a transfer of property without consideration, Létourneau J.A. stated (at paras. 9-10): According to case law, there is no doubt that the payment of dividends is a transfer of property within the meaning of section 160. In addition, it is difficult to see how the legal treatment of a dividend under corporate and civil law would prevent Parliament from regarding that dividend, for tax purposes, as a transfer of property without consideration when made by persons who are not dealing at arm’s length. ...