SimpsonWigle Law LLP Tax News

In Sorbara v. Canada (Attorney General), 2009 ONCA 506, the Ontario Court of Appeal held that the Ontario Superior Court of Justice does not have jurisdiction to hear an application relating to liabilty for GST under the Excise Tax Act (Canada). Parliament has given exclusive jurisdiction over that kind of question to the Tax Court of Canada. The appellant’s application for leave to appeal to the Supreme Court of Canada was dismissed with costs (2009 CanLII 61389). (more…)

If the Canada Revenue Agency (CRA) challenges your return and you can’t afford a tax lawyer, how likely are you to win your case? Does hiring a lawyer help your chances? (more…)

Tax Court litigation—or any other kind of litigation for that matter—is inherently unpredictable. Take Pigeau v. The Queen, 2009 TCC 582, for example. In that case, a key issue was the value of a property transferred from an individual to his grandfather. The taxpayer, who had the onus of proving value, showed up with nothing more than an MLS listing and a report that couldn’t be entered into evidence because the agent failed to give the proper notice. The Minister, on the other hand, had an expert’s appraisal in hand and the expert available to testify. The expert’s report was duly received, but the taxpayer still won, however, because the judge gave the benefit of the doubt to the taxpayer in choosing values from the ranges given by the expert. Which just goes to show you.

In Skinner v. The Queen, 2009 TCC 269, the taxpayer had reported as income in 2001 a large shareholder loan that had not been repaid. In 2002, the taxpayer attempted to deduct the amount previously included in income because the shareholder loan had been repaid. The Minister reassessed to reduce the taxpayer’s income in 2001 by reversing the inclusion for the shareholder loan. The Minister also reassessed to deny the deduction in 2002 because, after giving effect to the reassessment for 2001, the requirements of paragraph 20(1)(j) had not been met. The taxpayer appealed to the Tax Court of Canada, but the appeal was dismissed essentially on procedural grounds. (more…)

It’s hard educating clients about the tax system and what they’re up against when disputing assessments. Clients will often complain not just about the assessments they are fighting but the attitude of the auditor, the delays caused by the CRA and the unfairness inherent in a tax system that only a very few understand really well. The taxpayers in Lauger v. The Queen, 2007 TCC 650, brought these complaints to Tax Court with them and asked the Court to do the Right Thing. To which the Court, in dismissing the appeals, responded “I must decide whether the assessments are well-founded or not”. (more…)

The Tax Court, in Kubbernus v. The Queen, 2009 TCC 311, confirmed that a taxpayer cannot file an appeal to the Court for a reassessment issued at the taxpayer’s request pursuant to the taxpayer relief provisions. (more…)

Here’s a case with some local flavour, of a sort: Dundurn Street Loffts Inc. v. The Queen, 2009 TCC 122.

Sorbara v. Canada (Attorney General), 2008 CanLII 61246 (ON S.C.) is an interesting case about class action proceedings and Tax Court appeals. The moral of the story: the Tax Court has exclusive jurisdiction over tax matters even though it (probably) doesn’t have a class action procedure.

The CRA and the Crown like to say (or at least sometimes they act as if), in the objection and Tax Court appeal process, all that matters is whether the assessment in issue is correct. Justice J.E. Hershfield, in Wood v. The Queen, 2008 TCC 105, begged to differ. (more…)

The following article appeared in the latest edition of the Hamilton Law Association Law Journal.

The Income Tax Act (Canada) (the “Act”) contains numerous limitation periods that affect when the Canada Revenue Agency (the “CRA”) can issue an assessment to a taxpayer and when a taxpayer can and cannot dispute such an assessment. Understanding these limitation periods is an important pre-requisite for advising clients about a wide variety of legal problems, including, for example, the expiry period for representations and warranties in a share purchase agreement. (more…)