SimpsonWigle Law LLP Tax News

The Supreme Court of Canada has dismissed the taxpayer’s application for leave to appeal from the decision of the Federal Court of Appeal in Canada (Attorney General) v. Nash, 2005 FCA 386. Click here to read our article on the latter case.

Of course, Mr. Justice Rothstein, who wrote the Federal Court of Appeal opinion in Nash now sits on the Supreme Court, so the odds were not that good to begin with.

The Supreme Court also dismissed the taxpayer’s application for leave in Klotz v. The Queen, 2005 FCA 158, aff’g 2004 TCC 147.

Lipson v. The Queen, 2006 TCC 148, Chief Justice Bowman’s recent GAAR decision, is now available online.

For at least the last five or six years, an assortment of conspiracy theorists and their ilk have been trolling the Internet and spreading phony stories about the unlawful nature of Canada’s tax system (see, for example, the Usenet newsgroup can.taxes). (more…)

In my post yesterday, I should have mentioned that Lipson v. The Queen, 2006 TCC 148, considered a set of transactions with some similarity to those considered by Mr. Justice Little in Overs v. The Queen, 2006 TCC 26, which is another recent Tax Court decision involving the general anti-avoidance rule. In Lipson, Chief Justice Bowman distinguished Overs on the grounds that, in the latter case (and in Evans v. The Queen, 2005 TCC 684, another of his own decisions), “there was, factually, an underpinning of commerciality or estate planning” while in “the scheme involved here [there are] no such redeeming features” (¶29). The Chief Justice does not elaborate.

Two days ago, the Tax Court released the latest decision of Chief Justice Bowman on the general anti-avoidance rule (the GAAR). The case, Lipson v. The Queen, 2006 TCC 148, does not appear to be on-line yet.

The case considers a somewhat convoluted plan to make deductible interest payable in respect of a mortgage on a home as per Singleton v. The Queen, 2001 SCC 61. Chief Justice Bowman decided that the scheme “constitute[d] an abuse or misuse as contemplated by section 245, thereby justifying the assessing treatment accorded by the Minister of National Revenue”.

Jeff Manishen, a Hamilton lawyer who specializes in criminal law, wrote to me recently to ask some interesting questions about donations. Jeff sometimes negotiates arrangements under which clients can avoid prosecution by making a donation to a charity. Some charities, however, refuse to issue receipts for such donations. Is that right? My responses follow. (more…)