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Canco provided services for no consideration to LLC1. The Directorate concluded that Canco thereby was rendered a resident contributor to NRTrust (so that NRTrust was deemed to be a s. 94-resident trust) because s. 94(2)(f) deemed there to be a transfer of property to that trust, and it would be reasonable to view there as having been a resulting increase in the fair market value of the LLC1 shares. In the Directorate’s view, this result obtained even if s. 247(2) also applied to deem Canco to have received FMV consideration for its services. ...

CRA indicated that it now “has no administrative concession in place that limits the application of subsection 155(1),” and noted that after 1991, s. 155(2) was enacted to provides a detailed code for exceptions to the application of s. 155(1), so that: For example, if a charity were to make a non-arm’s length supply of real property for no consideration that was exempt by way of section 5 of Part V.I of Schedule V to the ETA, subsection 155(1) would not apply to deem the supply to be made for consideration equal to the fair market value of the property. ...

The second component was styled as a royalty agreement and contemplated that in consideration for a stipulated amount advanced to the company (which was labeled as an “interest free loan”), the company was to start paying a percentage of its product sales to the investor after a stipulated level of payments had been made under the loan agreement. ... Accordingly, there was a taxable supply by the company to the investors, and the “principal amount” advanced by them under their “loan” to the company was the up-front consideration charged to them for this taxable supply. ...

6 January 2020- 11:52pm Healius – Federal Court of Australia finds that lump sum payments made to lock-up doctors as customers for a 5-year period were currently deductible Email this Content A subsidiary (“Idameneo”) of an Australian public company that provided medical centre facilities and services to doctors in consideration for 50% of the fees generated by them. In order to induce a doctor to join one of the medical centres operated by it, it would typically pay a lump sum in the range of $300,000 to $500,000 to the doctor in consideration for the doctor’s promise to conduct his or her practice from the medical centre for a specified period of around five years, along with an exclusivity covenant. ...

Boyle J found that the $124,000 had been paid to her in consideration for equivalent consideration (her taking on the discharge of the remaining Corporate obligations), so that the s. 160 assessment was vacated. ...

ACo generated a refund of its eligible refundable dividend tax on hand, or its non-eligible refundable dividend tax on hand, balances, through the purchase for cancellation (in consideration for a promissory note) of a sufficient number of its common shares.. ... The pipeline proper transactions were then to be implemented under which: The estate transfers the remaining ACo common shares to a Newco formed by it in consideration for a note and one Newco common share. ...

30 December 2020- 11:37pm CRA finds that sponsorship of a PSB’s staged production was not subject to GST/HST Email this Content ETA s. 135 deem a supply by a public sector body (PSB) of a service, or a licence of copyright, a trade-mark, trade-name or other similar property to a “sponsor” for exclusive use by the sponsor in publicizing the sponsor’s business, to not be a supply – except that this rule is stated not to apply where the consideration for this supply by the PSB to the sponsor is “primarily” for radio, TV, newspaper, or magazine advertising. ... The agreements typically provided for consideration payable by that sponsor and for sponsorship rights, which included: acknowledgement as official sponsor of the event, logo visibility on event signage on a website, in newspapers, and in social media; the sponsor’s name being on a stage; a licence to use real property to promote its brand by offering samples; and VIP invitations to attend the event. ...

Profitco transferred Class 12 property on a s. 85(1) rollover basis to Lossco in consideration for redeemable preferred shares of Lossco, then Lossco transferred the properties back to Profitco in consideration for redeemable preferred shares of Profitco having a paid-up capital equaling their redemption amount, with a joint s. 85(1) election being made at the estimated FMV of the properties, so that Lossco realized recapture of depreciation. ...

The Corporation redeems the preferred shares in consideration for a note, designates a portion (based on its GRIP account) of the resulting deemed dividend as an eligible dividend and reports a resulting capital loss, which is carried back under s. 164(6). The Estate then transfers the Class A Common Shares to a “Newco” formed by it in consideration for Newco common shares. ...

S. 87(4) requires that such shares be the only consideration received by the Target shareholders “on the amalgamation.” CRA noted that any payments made by Parent to the Target shareholders for any breaches of representations or warranties would normally be made well after the amalgamation, and would not be viewed as consideration for shares paid on the amalgamation, so that s. 87(4) could still be satisfied– and it also would not be problematic if the compensation was paid by Parent in the form of issuing additional shares. ...