Search - consideration

., 75 DTC 5006, [1974] CTC 889 (FCTD)-- summary under Subsection 15(1) Summary Under Tax Topics- Income Tax Act- Section 15- Subsection 15(1) The Crown's theory was that an arrangement, whereunder (a) the majority shareholder ("Fratschko") of a private company ("Huron") acquired the shares in Huron held by a minority shareholder ("Peckham") as the result of the almost immediate default of Peckham on a loan to him by Fratschko, and (b) a contract whereunder a company ("Pelon") owned by Peckham agreed to perform services for Huron, should be regarded as a sale of shares by Fratschko to Peckham for consideration funded by the payments by Huron to Pelon under the service contract. ...

Repairs or Running Expense Property was leased for 60 years to a corporation ("Woodbine") for $180,000 payable on December 31, 1976 and the balance of the consideration of $180,000 payable on December 31, 1977. ...

Profit- Real Estate high leverage not significant if shareholder loans Before going on to find that the taxpayer did not realize a capital gain from the disposition of a farm property, Sharlow J. noted (at p. 5706) that although "the method of financing the purchase of property may be important in distinguishing capital from income if, as a practical matter, the property is so burdened with debt that the owner is unlikely to recover its costs without selling it", here this was not as important a consideration because, although there was 100% debt financing, this was provided by way of shareholder loans of which over 30% did not bear interest and had no fixed repayment terms. ...

"Had the plaintiff paid double the price in order to 'gain security of supply'... the agreement with the benefits as consideration would surely precipitate an enquiry as to whether it was reasonable or not. ...

Before finding that the payment of such amounts by the taxpayer in consideration for the cancellation of the options was deductible notwithstanding s. 18(1)(b) on ordinary principles, Joyal J. implicitly accepted the submission of the taxpayer's counsel that s. 7(3) "has no application as no issue of shares took place" (p. 6036). ...

In consideration of charging a customer $1.00 more for the replacement of a muffler, the taxpayer undertook to replace a defective muffler free of charge as long as the purchaser remained owner of the car in which the muffler had been installed. ...

Expense- Goodwill, Trademarks and Customer Lists The taxpayer acquired a capital asset when it purchased the customer lists of an insolvent insurance agencies practice and obtained the right to collect outstanding receivables in consideration of agreeing to pay 30% of the net commissions derived from the new customers over a 4 year period to the trustee in bankruptcy. ...

The Queen, 86 DTC 6264, [1986] 1 CTC 507 (FCTD), aff'd 88 DTC 6522, [1988] 2 CTC 365 (FCA)-- summary under Paragraph 7(1)(b) Summary Under Tax Topics- Income Tax Act- Section 7- Subsection 7(1)- Paragraph 7(1)(b) Since the taxpayer was held to be dealing at arm's length with a corporation ("Clarebeau") 1/2 of whose shares were owned by the taxpayer's family holding company and 1/2 of whose shares were owned by the family holding company of his business associate ("Claridge"), a sale by the taxpayer of share purchase options to Clarebeau for nominal consideration was governed by s. 7(1)(b) rather than s. 7(1)(c). ...

[s.158(2)] would appear to be directed more to a situation where a taxpayer is found to be making away with his assets, transferring them to others for insufficient consideration, is about to leave the country, or some such circumstances as would justify a seizure before judgment under provincial law. ...

The Queen, 90 DTC 6346, [1990] 2 CTC 83 (FCTD)-- summary under Section 96 Summary Under Tax Topics- Income Tax Act- Section 96 Four investors agreed to enter into a "syndicate" in which one of the investors would be entrusted with the care, training and maintenance of racing horses in consideration for a fee and reimbursement of his expenses, and the four investors would share equally in any revenues. ...