Search - considered

CRA elaborated on this position in the context of a graduated rate estate, indicating that: This position only applies “where the only reason that an amount of income is not payable to the beneficiaries is that it was earned in the initial 12 months of the estate” and does not apply where the income is not considered by CRA to be payable to the beneficiaries under the terms of the will. However, regarding the terms of the will, CRA is prepared to accept that, where the will does not specify which assets the bequests are to be paid from, “the residue of the Estate can include income” so that the income of the estate can be considered to be payable to the beneficiaries for ss. 104(6) and (23) deduction purposes. The quoted position allowing income in the executor’s year to be considered as payable to the beneficiaries only if they all so agree applies only where the estate has not been wound up in the executor’s year such that the estate administration continues beyond the first year (otherwise, the income would in fact have been payable in that year). ...

This would have de-suspended the loss but for s. 40(3.5)(c)(i), which applies if the particular corporation which, in fact, had disappeared (FA) would be considered to have been “merged or combined” with another corporation (Subco) to “form” a corporation. CRA was not flustered by the latter issues, and considered that the loss continued to be suspended: “Merged or combined” encompasses a winding-up or liquidation given inter alia the exclusion, in various provisions listed by it, of a winding up or liquidation from a “merger;” and “Formed” includes an entity in place after a reorganization (for example, a s. 86(1) reorganization), even though no new entity may be formed in the traditional sense- so that Subco was considered to have been “formed” on its s. 88(3) winding-up of FA under a “QLAD.” ...

Factors that may be considered include the level of non-compliance, large unexplained tax reserves, and potential tax at risk. The taxpayer’s list of uncertain tax positions that relates to tax reserves in the taxpayer’s financial statements is considered to be part of the taxpayer’s books and records and is not a privileged document unless otherwise demonstrated. ... Provided that all of the relevant facts of the transactions are included in their uncertain tax positions, exclusions of the advisors’ analysis of the legal and tax effects of the transactions may be considered. ...

After referring to the Quebec equivalent of s. 67, and in finding that the taxpayer had not met its burden of establishing that such assessments were incorrect, Allen JCQ stated: How can the plaintiff challenge the presumption of correctness of the notices of assessment where the 7.89% rate, considered to be reasonable and adopted by the defendant, falls within the range that its own expert considered to be a reasonable rate based on the current rates in the market for obligations with similar considerations and risks during the period in litigation? Doubtless, the rate of 7.89% corresponds to the lowest rate in the range, but it nonetheless is within that range and cannot be considered to be prima facie unreasonable. ...

In Markou, Paris J found that “ donative intent in civil law, as in common law, is always an essential element of a gift, even a partial gift,” whereas here “there was just one interconnected transaction and no part of it can be considered a gift that was given in expectation of no return.” ... As “no part of [the interconnected transaction] can be considered a gift that the appellant[s] gave in the expectation of no return” … [i]t follows that there was no gift whether the matter is considered from a common law or a civil law perspective. … He also stated: [W]here a person anticipates receiving tax benefits that exceed the amount or value of an alleged gift, the donative intent is necessarily lacking. ...

This loan will not be considered to be a contribution by him (so that it will not cause the trust to be resident for various purposes under s. 94(3)(a)) if it is an “arm’s length transfer,” whose definition relevantly requires that it reasonably be considered “that none of the reasons … for the transfer is the acquisition at any time by any person or partnership of an interest as a beneficiary under a non-resident trust.” ... CRA indicated that such a conclusion would be highly unlikely given his relationship to them – so that his loan would be considered to be a contribution to the trust causing him to be a resident contributor and the trust to come within s. 94(3)(a). ...

26 July 2021- 10:54pm CRA reaffirms that significant additional services transform rental income into income from services Email this Content Would the owner of a qualifying property that operates a hotel, or other similar business such as a motel or a bed and breakfast, be considered to use the property primarily to earn rental income as described in para. ... CRA stated: Generally, any income earned from the use or occupation of a property or a right to use or occupy property is considered to be rental income. ... CRA went on to indicate that the application of these tests was a question of fact, and did not repeat its vintage statement in IT-73R6 that a “corporation that operates a hotel is generally considered to be in the business of providing services and not in the business of renting real property.” ...

It considered that such headsets come within the exclusion in s. 8(6.1)(d), from what otherwise would qualify as an eligible “tool,” for an “electronic communication device” and also considered that the headsets did not come within its understanding of the ordinary meaning of "tool," namely, an item that is “designed to create a physical change in something or be used as an instrument of measurement or manipulation.” CRA also indicated that a pilot could not claim the deduction under s. 8(1)(g) (“transport employee’s expenses”) for the individual’s meal expenses incurred while away from the municipality of the employer establishment where the pilot reported for work (the “home city”), because the individual would fly back to the home city on the same day, and CRA considered that s. 8(1)(g) required that the “employee must generally be away from home overnight in the performance of their employment duties.” ...

31 October 2019- 12:23am CRA indicates that a taxpayer can make a voluntary disclosure where it twigs to the issue as a result of being charged for HST by a CRA-assessed 3rd party Email this Content CRA’s Memorandum on the GST/HST voluntary disclosure program states that a VDP application will not be considered voluntary if “enforcement action … relating to the subject matter of the VDP application has been initiated … against a third party, where the purpose and impact of the enforcement action against the third party are sufficiently related to the present application.” Regarding a situation where an unrelated supplier (Sco) had been supplying goods for resale to its customer (Aco), neither had been charging GST/HST based on what CRA would regard as a misinterpretation of a place-of-supply rule (in ETA s. 144), and Aco discovered this CRA view when CRA assessed Sco, who then charged the GST/HST to Aco, CRA stated: [I]f Aco and Sco are not related, the application from Aco would likely be considered under VDP. Conversely, if Aco and Sco are related companies, Aco’s application would not be considered as voluntary due to the prior enforcement action (audit) that was conducted against Sco …. ...

CRA stated: It is a question of fact whether a virtual medical service is considered rendered at the location of the health care professional, the location of the patient, or both. ... Each of these requirements must be considered before a determination can be made. ... Accordingly, this interpretation does not illuminate the question as to whether a professional working outside Canada can be considered to be rendering services in Canada to Canadian clients for purposes of Reg. 105. ...