Words and Phrases - "following"

67
31
47
38
29
22
13
10
55
1
2
22
39
21
29
64
1
52
62
35
9
8
12
1

S.T.B. Holdings Ltd. v. Canada, 2002 DTC 7450, 2002 FCA 386

The Court rejected a submission that s. 245(7) required that, in order for GAAR to be applied, the reassessment notice must state on its face that GAAR is being utilized and GAAR must be the primary assessing position. The Tax Court judge had correctly interpreted the word "following" to mean "after". S.245(7) referred to a prior GAAR application to a taxpayer resulting in a subsequent determination of the tax consequences for another, i.e., s. 245(7) was intended to apply only to third parties seeking a tax relief - a conclusion that was supported by the French version and the sandwiching of s. 245(7) between two subsections geared toward third-party adjustments.

Words and Phrases
following

J.K. Read Engineering Ltd. v. The Queen, 2014 DTC 1216 [at 3872], 2014 TCC 309

GAAR applies to impose liability for abusive transactions from inception

The taxpayers acknowledged that capital losses (purportedly generated under schemes similar to Global Equity, 1207192 and Triad Gestco) should be denied under GAAR, but argued (based on s. 245(7)) that as GAAR could not be applied without the intervention of the Minister, interest began to accrue only from the time of the GAAR assessments.

Hogan J found that in Copthorne, the taxpayer was liable for failure to withhold on a deemed dividend that arose because of GAAR already having applied to reduce the related shares' paid-up capital. The taxpayers' argument was contradicted by the "authoritative obiter" in S.T.B. that s. 245(7) applied to third parties only. Furthermore, after noting the references in s. 245(7) to tax consequences to a person "following" the application of s. 245 being determined by assessment, he stated (at para. 39) that the definitions of "following" in dictionaries "clearly indicate that the notice of assessment does not trigger the application of the GAAR, but is rather subsequent to it." He concluded (at para. 43):

I see nothing …to suggest that the application of the GAAR is suspended until an assessment is issued. On the contrary, subsection 245(2)…uses mandatory language to provide that the tax consequences of abusive avoidance transactions shall be recast to deny tax benefits that are not reasonable in the circumstances.

Words and Phrases
following
Locations of other summaries Wordcount
Tax Topics - General Concepts - Res Judicata weight of obiter depends on fulness of argument 77
Tax Topics - General Concepts - Stare Decisis weight of obiter depends on fullness of argument 77
Tax Topics - Income Tax Act - Section 161 - Subsection 161(1) interest under GAAR assessments accrued from balance due dates 52