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R. v. Loosdrepht, 2009 DTC 6088 (BC Prov. Ct.)

Before going on to find that the individual taxpayer had committed tax evasion by filing nil returns and taking the position that he was not a taxpayer, Hicks, J. stated (at para. 44) that "the courts in this Province have found without exception that the argument to exclude so-called natural persons from the obligations of the Income Tax Act has no basis."

Doyle v. MNR, 89 DTC 5483 (FCTD)

A reference in s. 225.1(5) to a taxpayer "should be interpreted as allowing an agent to sign on behalf of a taxpayer providing the agency is well and truly established."

The Queen v. Merali, 88 DTC 6173, [1988] 1 CTC 320 (FCA)

nexus to Ccn source

"[B]oth residents and non-residents who derive income from Canadian sources are included, by definition, in the term 'taxpayer'." [C.R.: 248(1) - "Income Bond"]

Oceanspan Carriers Ltd. v. The Queen, 87 DTC 5102, [1987] 1 CTC 210 (FCA)

"Taxpayer" "refers to resident individuals or corporations who may be liable to pay tax at some time whether or not they are, at any given time, liable therefor." A corporation with no Canadian-source income accordingly was not a "taxpayer" for purposes of s. 111(8)(b), and non-capital losses which it incurred while not a resident corporation could not be carried forward to be deducted from income earned while the corporation was resident in Canada.

Words and Phrases

Gordon v. The Queen, 86 DTC 6426, [1986] 2 CTC 280 (FCTD), aff'd 89 DTC 5481 (FCA)

It was found respecting some losses from a partnership engaged in the breeding and racing of horses that s. 31(1) applies at the level of the individual partners to whom the farming losses have been flowed through rather than at the partnership level, i.e.,a partnership is not the "taxpayer" for the purposes of s. 31(1).

Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 31 - Subsection 31(1) 143

Lea-Don Canada Limited v. Minister of National Revenue, 70 DTC 6271, [1971] S.C.R. 95

"taxpayer" did not extend to those not subject to tax

A Canadian subsidiary ("Nassau") of a Bermudan company that did not carry on business in Canada was leasing an aircraft to the appellant, which was another Canadian subsidiary of the Bermudan company. Nassau sold the aircraft to the Bermudan company for a sale price that was lower than the aircraft's fair market value and took the position that s. 17(2) of the pre-1972 Act which applied to a taxpayer carrying on business in Canada who sold anything to a person with whom he was not dealing at arm's length) did not apply to deem Nassau to have received fair market value proceeds on the basis that s. 17(2) was deemed by s. 17(7) not to apply where s. 20(4) was applicable. The latter provision maintained historical capital cost and undepreciated capital cost where a depreciable property "has, by one or more transactions between persons not dealing at arm's length, become vested in a taxpayer".

In rejecting this position Hall J. stated (at p. 6274):

"It is clear that s. 20(4) is concerned with taxpayers entitled to a deduction, not with persons who are not subject to assessment under Part I. A non-resident not carrying on business in Canada is not a person entitled to such a deduction and therefore s. 20(4) cannot be properly be said to be 'applicable' to him."

Furthermore, the exigibility of withholding tax on rents paid to the Bermudan company did not make the Bermudan company a taxpayer as such withholding tax was "a tax on gross receipts in Canada by a resident for a non-resident."

See Also

King George Hotels Ltd. v. MNR, 68 DTC 635 (TAB)

An incorporated charitable foundation was found to be a "taxpayer" notwithstanding that it was not taxable under s. 62(1)(f) of the pre-1972 Act.

Administrative Policy

23 July 1996 External T.I. 5-960222 -

A non-resident trust that does not carry on business in Canada, does not hold taxable Canadian property and is not subject to s. 94 of the Act will not be a "taxpayer" for purposes of ITAR 26(3) based on the Oceanspan (87 DTC 5102) and Holiday Luggage (86 DTC 6601) cases.

18 January 1993 External T.I. 5-921718 -

A loan by a non-resident individual to a Canadian partnership secured by a second mortgage on a building owned by the partnership, that provided for the payment on maturity of 10% of the appreciation in value of the building in addition to interest at a rate of 11% per annum, would constitute an interest in real property situated in Canada for purposes of s. 115(1)(b) under the broad definition in s. 115(3). "In our view, the non-resident's interest in the building, which includes a right to participate in the appreciation of the building, is not 'an interest as security only'" as contemplated in s. 248(4).

Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 248 - Subsection 248(4) 125

23 September 1991 Memorandum (Tax Window, No. 8, p. 22, ¶1429)

In determining the number of shares under the 25% test in s. 115(1)(b)(iv), options held by the non-resident person or non-arm's length person are treated as having been exercised.

IT-176R2 "Taxable Canadian Property - Interest in and Options on Real Property and Shares"

84 C.R. - Q.16

"taxpayer" in s. 20(1)(j) is considered to include a partnership where a loan previously has been included in the partnership's income.

Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 15 - Subsection 15(2) 24


Segal, "Dispositions of Interest in and Options on Real Property and Shares by Non-Residents of Canada", 1994 Canadian Tax Journal, Vol. 42, No. 2, p. 327