Forgiveness of Debt

Cases

Queenswood Land Associates Ltd. v. Canada, 2000 DTC 6065 (FCA)

In finding that the forgiveness of debt used to finance land inventory of a predecessor of the taxpayer occurred on capital account, so that s. 80...

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MNR v. Enjay Chemical Co. Ltd., 71 DTC 5293, [1971] CTC 535 (FCTD)

In 1961 the taxpayer purchased over £5 million of oxo-alcohol from a U.S. affiliate for a deferred U.S.-dollar purchase price. The subsequent...

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Oxford Motors Ltd. v. Minister of National Revenue, 59 DTC 1119, [1959] CTC 195, [1959] S.C.R. 548

The Canadian distributors of Morris cars, including the taxpayer, were offered by their British supplier ("Nuffield") a rebate of $250 for each...

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Plimley Automobile Co. Ltd. v. MNR, 58 DTC 1112, [1958] CTC 193 (Ex Ct), briefly aff'd on consent 60 DTC 1031 (SCC)

15% of indebtedness of the taxpayer to its English supplier which it had incurred for car shipped to it was forgiven by the English supplier, with...

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See Also

Molstad Development Co. Ltd. v. The Queen, 97 DTC 913, [1997] 2 CTC 2360 (TCC)

Following the sale by the taxpayer of its only asset (land inventory) at a loss, the secured creditor (a bank) forgave the amount of the debt that...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 54 - Proceeds of Disposition 100

Denthor Developments Ltd. v. The Queen, 97 DTC 667, [1997] 1 CTC 2075 (TCC)

The gain of the taxpayer, which was a land developer, on being discharged pursuant to a settlement agreement of bank indebtedness of $2.2 million...

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Alco Dispensing Canada Ltd. v. The Queen, 96 DTC 1586, [1996] 1 CTC 2662 (TCC), briefly aff'd 97 DTC 5463 (FCA)

An agreement for the sale of the shares of the taxpayer required that accrued bonuses totalling approximately $1.6 million "be reversed back into...

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Administrative Policy

2 November 2023 APFF Roundtable Q. 1, 2023-0975421C6 F - Paragraph 25 of IT-293R (Archived)

IT-293R, para. 25 indicates that where the forgiveness of a trade debt occurs in a taxation year subsequent to that in which it was incurred, any...

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12 September 2012 Annual CTF Roundtable, 2012-0453381C6 - 2012 CICA Conference

An insolvent (but not bankrupt) company negotiates a settlement with CRA of unpaid source deductions and unremitted GST for less than the balance...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 12 - Subsection 12(1) - Paragraph 12(1)(x) forgiveness of unremitted GST 35
Tax Topics - Income Tax Act - Section 80 - Subsection 80(1) - Forgiven Amount tax debt not a commercial debt obligation 113

20 May 2014 External T.I. 2013-0516121E5 F - Debt forgiveness

A compromise by Aco under Division I of Part III of the Bankruptcy and Insolvency Act resulted in reassessments owing by Aco for unremitted GST...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 12 - Subsection 12(1) - Paragraph 12(1)(x) - Subparagraph 12(1)(x)(iv) BIA settlement of GST interest and penalties included under s. 12(1)(x)(iv) 157
Tax Topics - Income Tax Act - Section 12 - Subsection 12(2.2) s. 12(1)(x)(iv) inclusion from BIA settlement of GST interest and penalties could be offset against related expense 157
Tax Topics - Income Tax Act - Section 248 - Subsection 248(26) unremitted GST and QST were not obligation "issued" by debtor 102
Tax Topics - Income Tax Act - Section 80 - Subsection 80(1) - Commercial Debt Obligation BIA settlement of unremitted GST interest 127

15 July 2009 External T.I. 2008-0289731E5 - Forgiveness of Accrued Interest

Court findings indicate that the determination as to whether the forgiveness of debts and similar obligations incurred in the course of carrying...

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IT293R "Debtor's gain on settlement of debt"

Trade Debts Forgiven

25. ...[F]orgiveness of a trade debt in the same taxation year in which it was incurred is required to be included in...

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