Search - consideration

14 May 2018- 12:09am CRA finds that making the ETA nil consideration election can have punitive results respecting GST/HST on related employee benefits Email this Content Although ETA s. 173(1) often imputes a taxable supply by an employer based on the amount of taxable benefits conferred by it under ITA s. 6(1)(a), s. 173(1)(d)(i) provides that this rule does not apply where the employer was denied an input tax credit under s. 170 on its acquisition of the property or service that, in turn, was provided to the employee. ... CRA found that this s. 173(1)(d)(i) exclusion did not apply where the property in question (an automobile) was acquired by a closely-related corporation and then leased to the employer with the benefit of the s. 156 nil-consideration election, with the automobile being provided for the exclusive personal benefit of an employee. ...

28 January 2019- 11:43pm CRA confirms that it will not apply s. 112(3) to a dividend that has been subjected to s. 55(2) and discusses animating policy considerations Email this Content In its published comments on its further conclusions on various questions posed to it on the s. 55(2) rules, CRA provided some more detail than in its oral presentation at the 2018 Annual Conference. ... CRA also was more loquacious on the policy considerations underlying its interpretations. ...

7 March 2021- 11:10pm Engineering Analysis Centre – Supreme Court of India finds that consideration for software paid by Indian resellers was not royalties for Canadian (and other) Treaty purposes Email this Content The OECD Commentary on the royalty article (Art. 12) states i nter alia that “where a distributor makes payments to acquire and distribute software copies (without the right to reproduce the software),” such payments generally “would be dealt with as business profits in accordance with Article 7” rather than as royalties under Art. 12 – and that this would be so “regardless of whether the copies being distributed are delivered on tangible media or are distributed electronically (without the distributor having the right to reproduce the software).” Nariman J considered a multitude of appeals, principally involving consideration paid to non-residents (who were respective Treaty residents in 18 different countries including Canada) by: Indian end-users for the purchase of software (for example, a non-exclusive licence to use Samsung software on the end-user’s Samsung mobile device, with a prohibition against making the software available to any other person); or Indian (or non-Indian) distributors for resale to Indian end-users or other Indian distributors. ...

5 October 2022- 10:57pm If commercially feasible, deferred share consideration can be used instead of a share sale occurring on a cash earnout basis Email this Content Some points made on share sale earnouts, or achieving their equivalent without having to address s. 12(1)(g), include: The contingent payment terms can be embedded in the terms of special shares issued by the Canadian purchaser, thereby permitting s. 85(1) rollover treatment, and with a Callco needed in the buyer structure to avoid Pt. ... However, the election form (T2057) creates difficulties in that it refers only to the “share consideration” rather than also including rights to receive shares in that quoted phrase. ...

(f) exclusion from disposition re a transfer for no consideration to new trust for the same special-needs minor beneficiary Email this Content A special-needs minor child (CC4), who was the sole beneficiary of an inter vivos trust for the child’s exclusive benefit, held non-voting Class A common shares of a holding company (Fco), with CC4’s three siblings holding the other Class A shares directly. ... Fco makes a PUC distribution to the trust by distributing a note of a subsidiary in an amount sufficient for the trust to pay the tax on the above taxable dividend. the father of CC4 settles a new trust for the exclusive benefit of CC4, with the old trust transferring its Class Z shares of Fco to the new trust for no consideration, and with the new trust not electing out of the application of para. ...

30 May 2017- 1:14am Lumenpulse privatization contemplates cash consideration for its majority public shareholders and a share-for-share exchange for 38% of its shareholders Email this Content Under the proposed privatization of TSX-listed Lumenpulse pursuant to a CBCA Plan of Arrangement, the public shareholders would receive cash for their common shares, and the specifically-listed “Rollover Shareholders” (holding 38% of the common shares) would receive common shares of the newly-incorporated purchaser, which is an indirect subsidiary of Power Corporation of Canada. ...

11 February 2018- 10:58pm Consideration should be given to avoiding an immediate liquidation of an RESP on death Email this Content A registered education savings plan will form part of the estate of a deceased sole or last subscriber to the RESP. ...

20 October 2015- 12:24am CRA finds that a commitment fee earned by the assignor of a loan is consideration for the loan made by the assignee for HST purposes Email this Content Exempt financial services include (in para. ...

24 July 2014- 3:14pm First Quantum acquisition of Lumina uses tainting nominal cash for the share consideration alternative, and provides for cashless option surrenders Email this Content Lumina Copper shareholders can elect to receive First Quantum shares or cash for the acquisition of their shares subject to proration to keep the overall cash/share mix essentially fixed.  ...

22 March 2015- 8:25pm Majority shareholders of Wheels Group agree to bear the full brunt of any proration required to constrain the overall mix of cash and share consideration paid under a Radian Logistics acquisition Email this Content Radian Logistics, a listed Delaware corporation, is proposing that its new ULC subsidiary acquire all of the shares of Wheels Group for cash or Radian Logistics shares under a Plan of Arrangement. ...