Executive Summary  Eastmain believed its CEO’s salary qualified as a “Canadian Exploration and Development Overhead Expenses” and deducted the same.     Revenu Québec (“RQ”) denied Eastmain’s 2007 to 2010 “Credit Relating to Mining or Other Resources” (the “Resource Credits”) claim under Québec’s Taxation Act (the “Act”).1 RQ held that Eastmain did not qualify for the Resource Credits because its expenses did not “all or substantially all” relate to exploration activities. This case revolves around the interpretation of “substantially all” as it applies to eligi ..read more

The Tax Court of Canada’s recent ruling in Fiera Foods Company v. HMK1 has significant implications for businesses claiming Input Tax Credits (ITCs) under the Excise Tax Act (ETA).   ..read more

Key Points in Glencore The case involves an appeal against a reassessment under the Income Tax Act, where the Minister of National Revenue assessed as income certain fees Falconbridge received due to a failed merger. The Tax Court of Canada ruled that these fees count as ancillary business income from Falconbridge’s mining activities.  Background To the Income Tax Act Reassessment in Glencore Glencore Canada’s predecessor, Falconbridge developed a nickel deposit in Sudbury, Ontario, and a refinery in Kristiansand, Norway. In 1996, Falconbridge initiated a merger offer with Diamond Fiel ..read more

Resolving Tax Disputes (3rd edition) studies tax disputes, conflict levels, and basic strategies. It helps accountants to limit early-stage mistakes and reduce liability.   One of the chapters in RTD3 is about audits and how to handle them. It provides valuable tips to help you navigate the audit process. We’ve included some excerpts from that chapter in this article.  ..read more

Resolving Tax Disputes (3rd edition) studies tax disputes, conflict levels, and basic strategies. It helps accountants to limit early-stage mistakes and reduce liability.   One of the chapters in RTD3 is about audits and how to handle them. It provides valuable tips to help you navigate the audit process. We’ve included some excerpts from that chapter in this article.  ..read more

Management M.-A. Roy Inc. v. HMK (“Gestion Roy”) centers around whether an Opco’s decision to pay insurance premiums, with two Holdcos as the policy owners, gives rise to a shareholder benefit under subsection 15(1) of the Income Tax Act. If such a benefit exists, then subsection 15(1) warrants the inclusion of its value in the shareholder’s income ..read more

With the increase in e-commerce and the fact that corporate residence is corporation-specific, it is possible to create a corporation that is not resident anywhere. However, there are tax implications for corporations operating in Canada without a physical presence.   ..read more

We’re delighted to announce our newly updated chapter on Corporate Residence & Tax Disputes in Canada (2023), published by Thomson Reuters, is now available ..read more

Thompson Reuters considers the authors “leading tax experts and litigators”. The authors agreed to grant TR partial rights to this work. This article first appeared in TR’s Tax Dispute and Resolution Centre. In Brown v. Canada 2022 FCA 200, the Federal Court of Appeal restated the source-of-income test and applied the test to the taxpayer’s management services activity. The FCA focused on the nature of the activity and clarified that, in situations where the activity lacks any personal element, the test requires courts to consider still whether the taxpayer aims to generate profit by engaging ..read more

The Supreme Court of Canada, in Canada (Attorney General) v. Collins Family Trust,1 further clarifies when courts can grant equitable remedies of rectification or rescission.  ..read more