Article 27A


Gulfmark offshore N.S. Limited v. Canada, 2007 DTC 5563, 2007 FCA 302

The taxpayer, a U.K. company, supplied a ship and a crew (obtained under subcontract from a related non-resident company) to a Canadian company for use in transporting pipe joints and other materials from Nova Scotia to an installation used closer to Sable Island.

The fact that the crew received various instructions from the Canadian company was not inconsistent with the Tax Court's finding that the taxpayer was operating the ship and, thus, was "carrying on activities" for purposes of being deemed under Article 27A of the Canada-U.K. Convention to be carrying on business in Canada through a permanent establishment.

Administrative Policy

12 July 1991 Memorandum (Tax Window, No. 6, p. 3, ¶1352)

General discussion.


Administrative Policy


Re application of paragraph 4 of Article 27 of the Canada-U.K. Convention where a share of a U.K. corporation held by a resident of Canada is purchased for cancellation. RC states that "both the amount of $101 representing the purchase price for cancellation and the U.K. tax credit of $25 would be considered to be proceeds of disposition of the share giving rise to a capital gain treatment. The Canadian resident would be allowed a foreign tax credit for the aggregate U.K. withholding tax of $18.75 levied on the purchase price of the share and the U.K. tax credit."

20 October 1992 T.I. 922116 (September 1993 Access Letter, p. 418, ¶C111-055)

A non-resident of Canada who was resident in England but not domiciled there for tax purposes, and who on her death in England is subject to English estate duty to a deemed disposition under s. 70(5) on shares of a private Canadian corporation and would not be considered to be taxed in the U.K. by reference to an amount that was remitted to or received in the U.K. as a result of such deemed disposition. Accordingly, paragraph 2 of Article 27 of the Canada-U.K. Convention would not apply.

Locations of other summaries Wordcount
Tax Topics - Treaties - Income Tax Conventions - Article 29 92

22 July 1991 T.I. (Tax Window, No. 7, p. 22, ¶1364)

Paragraph 2 of Article XXVII of the Canada-U.K. Convention not only restricts the right of taxpayers to claim total exemptions under the Convention, but also restricts the right to claim partial or rate relief.

Locations of other summaries Wordcount
Tax Topics - Treaties - Income Tax Conventions - Article 29 38