SimpsonWigle Law LLP Tax News

You can now check the CRA’s website to see whether a person really is a GST registrant. The CRA explains:

The GST/HST Registry lets you validate the GST/HST number of a business, which helps to ensure that claims submitted for input tax credits only include GST/HST charged by suppliers who are registered for GST/HST. You can also use the GST/HST Registry to verify GST/HST registration for other purposes.

For example, a vendor of real property can check whether the purchaser is registered so that the vendor need not collect GST on the sale.

In September last year, I wrote a short article about fraud and income tax. The Federal Court of Appeal reiterated the law on this subject in Vankerk v. The Queen, 2006 FCA 96. The ratio of Madame Justice Sharlow is worth quoting:

[3] All of these arguments [about acting in good faith and with due diligence] miss the point. This is not a case in which the deductibility of a loss can be saved by evidence that the appellants acted with due diligence. This is not a case of a business that suffered losses because it was ill conceived or poorly managed, and the tax authorities are second guessing the business acumen of a taxpayer. This is a case where, in fact, there was no business. There were no business expenses. There is no factual foundation for any of the deductions claimed by the appellants. These appeals will be dismissed with costs.

Some time ago, we wrote an article for The Bottom Line on accountants and client privilege (see the mid-September, 2003 issue). In the article, we noted that, in light of Tower v. M.N.R. and BDO Dunwoody LLP, [2002] D.T.C. 7315 (F.C.T.D.), rev’d 2003 FCA 307 on other grounds, most communications between an accountant and her client are not privileged. A recent case—M.N.R. v. Reddy, 2006 FC 277—shows that neither is some of the confidential information held by a lawyer about her client. (more…)

I am regularly asked whether it is possible to “multiply” the small business deduction (the SBD), and just as regularly I find it difficult to provide easy-to-understand advice and guidance. The association rules are complex, and even if their technical requirements are met the CRA can still reassess to require corporations to share the SBD on the grounds that they are controlled de facto by the same person. Two recent cases show that the courts are willing to uphold such reassessments. (more…)

I presented “Current Tax Cases” at the CRA’s Hamilton and District Tax Consultation Group on June 1, 2006 at the Royal Botanical Gardens. You can download my PowerPoint presentation here.