Closely Related Group

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CIBC World Markets Inc. v. Canada, 2019 FCA 147

definition has the effect of extending s. 150 election to exported supplies of Canadian PEs of non-resident insurers

The Crown argued that the language in s. 132(3) was inadequate to deem a non-resident permanent establishment of an affiliate of the appellant (CIBC) to be a separate person from CIBC for ETA s. 150 purposes because unlike, for example, the definition of “closely related group” in s. 123(1), it did not specifically deem the PE to be a separate person. In the course of rejecting this argument, Noël C.J. stated (at para. 47):

[T]he deeming rule in subsection 123(1) has a broader application than the one in subsection 132(2). It deems a non-resident insurer that has a permanent establishment in Canada to be a resident of Canada without the need for the activities in the course of which the supplies are made to be conducted through that establishment. As a result, a non-resident insurer that is deemed to reside in Canada by virtue of subsection 123(1) and that is a party to a subsection 150(1) election would have to treat as exempt all supplies made within the closely related group, including those that are exported. As subsection 123(1) makes clear, this exceptional treatment is restricted to non-resident insurers … .

Locations of other summaries Wordcount
Tax Topics - Excise Tax Act - Section 132 - Subsection 132(3) a non-resident PE had deemed separate person status sufficient to insulate it from an ETA s. 150 election 305
Tax Topics - Excise Tax Act - Section 132 - Subsection 132(4) expansive deemed person language required because 2 PEs involved 372
Tax Topics - Excise Tax Act - Section 150 - Subsection 150(2) s. 150(2) amendment was required because of the risk of taxpayers arguing otherwise 469
Tax Topics - Statutory Interpretation - Ordinary Meaning ambiguity can arise on consideration of how the provision interacts with another 172
Tax Topics - Excise Tax Act - Section 123 - Subsection 123(1) - Supply no supplies between PEs of the same person in the absence of s. 132(4) 70