Search - convention

The Queen, 2019 TCC 270 (Informal Procedure)-- summary under Article 24 Summary Under Tax Topics- Treaties- Income Tax Conventions- Article 24 mandatory contributions by a dual resident to the UK’s national insurance scheme did not qualify for Treaty relief A resident of both Canada and the UK who was employed full-time in the UK for several years was not entitled to claim a foreign tax credit under s. 126(1) for mandatory contributions that he made in 2016 to the UK’s national insurance scheme, on the basis that such contributions were not foreign income “taxes”. Bocock J also found that the taxpayer was not entitled to relief against double taxation under the Canada-UK Income Tax Convention, stating (at para 14): … Because the amount has not yet been subject to tax in the UK (because it has been deducted from income before calculating income tax) there is no requirement under the Convention or section 126 of the Act to provide relief in Canada. ...

HMRC Commissioners, [2016] UKFT 0234 (TC) (First-Tier Tribunal)-- summary under Article 3 Summary Under Tax Topics- Treaties- Income Tax Conventions- Article 3 “treatment is the meaning” – employment income deemed by U.K. domestic legislation to be from carrying on a “trade” was therefore deemed by Art. 3(2) to be “business profits” for Treaty purposes The taxpayer was a resident of South Africa for purposes of the U.K-South Africa Convention (the “Treaty”) who, likely as an employee, undertook diving engagements in the UK continental shelf waters. ... After referring to Art. 3(2) of the Treaty (which corresponded to Art. 3(2) of the OECD Model Convention) and to the interpretive principles established under the Vienna Convention, as judicially interpreted, and before concluding that the taxpayer’s income from diving would fall within Art. 7, Brannan J stated (at paras. 107, 111): [T]he words “enterprise” and “business” are not defined terms for the purposes of Article 3(2). ... Brannan J also stated (at para. 115): If a Contracting State changes its domestic law after the conclusion of a double tax treaty in such a way as to reallocate income from one article to another...that could contravene the requrements of good faith imposed by Article 31(1) of the Vienna Convention.... ...

Canada (Attorney General), 2015 FC 1082-- summary under Article 27 Summary Under Tax Topics- Treaties- Income Tax Conventions- Article 27 FATCA information exchanged automatically irrespective of any substantive U.S. tax liability was "relevant" to U.S. tax administration Ginny Hillis, who was born in the U.S. to Canadian-citizen parents and came to Canada when she was five, brought an action for a declaration that the Canadian FATCA legislation (i.e., the Canada-United States Enhanced Tax Information Exchange Agreement Implementation Act (enacting an intergovernaental agreement) and ss. 263 to 269 of the Income Tax Act) was void as unconstitutional and that the disclosure of taxpayer information under such legislation should be restricted rather than automatic in light of the provisions of the Canada U.S. Income Tax Convention (the "Convention") and s. 241 of the ITA. ... Before dismissing the motion, Martineau J rejected a submissions that "the account holder information collected by the reporting institutions on US persons… must… be shown to 'be relevant' for carrying out the provisions of the [Convention]…[as] the ‘may be relevant' test mentioned in Article XXVII of the [Convention] must be satisfied on a case by case basis" (para. 59) and, in particular, "since most US persons resident in Canada do not owe taxes to the US…their account holder information is of no relevance… and therefore does not fall within the scope of information that may be disclosed pursuant to Article XXVII" (para. 60), stating (at paras. 70-71) that: It is…unreasonable to conclude that the governments of Canada and the US entered into an Intergovernmental Agreement which should be interpreted in a way that renders it practically impossible to perform. ...

Canada, 2012 SCC 14-- summary under Subsection 245(4) Summary Under Tax Topics- Income Tax Act- Section 245- Subsection 245(4) Woods, J. rejected a submission of the Crown that it would have represented an abuse of the Canada-Barbados Income Tax Convention to use the gains exemption in Article XIV(4) to avoid an anti-avoidance rule such as s. 94 of the Act (after noting that in the OECD Commentary, the OECD indicated that contracting states may need to explicitly provide in income tax conventions for the preservation of the right to apply domestic anti-avoidance provisions). She also rejected a submission that it represented an abuse of that Convention to rely on such treaty exemption where the trust in question had very little connection with Barbados. ...

The Queen, 2002 DTC 1856 (TCC)-- summary under Article 4 Summary Under Tax Topics- Treaties- Income Tax Conventions- Article 4 The taxpayer, who was a resident of Canada and was employed as a commercial airline pilot by a wholly-owned subsidiary of a Hong Kong airline company ("Cathay Pacific"), took the position that his employment income was exempt from Canadian tax by virtue of the Canada-China Convention because it was earned in respect of an employment exehrcised aboard aircraft operated in international traffic by an enterprise resident in China (i.e., Cathy Pacific). The term "resident of a Contracting State" was defined in the Convention as "any person who, under the laws of that Contracting State, is liable to tax therein by reason of his... residence.... ...

Revenue and Customs Commissioners, [2013] BTC 485, [2013] EWCA Civ 578-- summary under Article 26A Summary Under Tax Topics- Treaties- Income Tax Conventions- Article 26A new tax collection Article applied to old tax debts The most recent Income Tax Convention between the U.K. and South Africa had entered into force on 17 December 2002, and a Protocol providing for mutual collection assistance (through the addition of Article 25A) was subsequently entered into "in respect of requests for assistance made on or after the date of entry into force of this Protocol" of 13 October 2011. ... In rejecting the taxpayer's submission that Article 25A did not apply to the collection of tax debts arising prior to the coming into force of the 2002 Convention, Lloyd Jones LJ stated (at para. 23): "Taxes" in Article 25A(2) does not need to be limited by reference to the date of their accrual. ...

Canada (Attorney General), 2015 FC 1082-- summary under Article 26A Summary Under Tax Topics- Treaties- Income Tax Conventions- Article 26A Art. 26 of US Convention did not prohibit FATCA information exchanges One of the challenges brought by the appellant to the Canadian FATCA legislation (i.e., the Canada-United States Enhanced Tax Information Exchange Agreement Implementation Act and ss. 263 to 269 of the Income Tax Act) was that "to the extent that Canada's disclosure of account holder information to the US constitutes 'assistance in collection,' Canada is prohibited [by Art. ... Convention] from disclosing such information as it relates to Canadian citizens…[so that] account holder information should not be disclosed in cases in which the taxpayer was a Canadian citizen at the time the revenue claim arose" (para. 58). ...

The Queen, 2022 TCC 49-- summary under Article 6 Summary Under Tax Topics- Treaties- Income Tax Conventions- Article 6 may-be-taxed language does not confer an exclusive right to tax Regarding a resident individual, who was assessed for Canadian income tax on income derived by him from a rental property in France, Lafleur J stated (at paras. 30-32, Tax Interpretations): Article 6(1) of the Tax Convention provides that: "Income from immovable property... may be taxed in the Contracting State in which such property is situated. ... For example, Article 14(1) of the Tax Convention provides that: "Income derived by a resident of a Contracting State in respect of professional services... shall be taxable only in that State... ...

., 99 DTC 567, [1999] 2 CTC 2259 (TCC)-- summary under Article 12 Summary Under Tax Topics- Treaties- Income Tax Conventions- Article 12 A lump-sum payment made for a non-exclusive licence to source code to be used by the taxpayer in manufacturing software to be sold by it was exempt under s. 212(1)(d)(vi) and under Article XII, para. 3 of the Canada-U.S. Income Tax Convention. ...

The Queen, 81 DTC 5140, [1981] CTC 209 (FCA)-- summary under Article 13 Summary Under Tax Topics- Treaties- Income Tax Conventions- Article 13 meaning of exchange The purchase of shares pursuant to an employee stock option agreement was found not to be "an exchange of capital assets" within the meaning of the 1942 Canada-U.S. Convention. ...