The Canada Revenue Agency (CRA) was recently asked their view on whether the “reasonable return” exception in would apply to preclude the application of the tax on split income (“TOSI”) rules. An adult individual who is resident in Canada (“Spouse A”) incorporated a company (“Opco”) to operate a non-services business….
Derek de Gannes
Derek A. de Gannes: Senior Director, Business Tax of RSM Canada. RSM Canada is committed to the highest level of integrity, quality and professionalism and provides clients with solutions in the area of Audit, Tax and Transaction Services. Email: derek.degannes@rsmcanada.com
Income attribution rules, generally speaking, operate so that income of one person (the actual recipient of the income) is attributed to and becomes income of another person (the transferor). Whether or not income which is subject to subsection 75(2) is first and foremost income of the trust itself can be…
Executors and personal representatives are tasked with making sure the deceased’s tax obligations are properly dealt with out of the deceased’s estate. An issue that may arise in the course of dealing with the obligations is how to deal with loans and advances from a private company. The Canada Revenue Agency…
The Canada Revenue Agency recently responded to a ruling request as to whether or not a proposed amendment to a trust agreement could be so significant to cause a resettlement of the trust, or a disposition of a beneficiary’s interest in the trust Before the enactment of variation of trusts…
The income tax treatment of a trust and its beneficiary where the trust lost its status as a tax-free savings account (TFSA) because it contravened the registration restriction on borrowing money was the subject of a recent Canada Revenue Agency(CRA) technical interpretation. The trust continued to exist for several years…
While it has been over 18 months since its implementation, we are still learning more about the application of the tax on split income (TOSI) rules. The Canada Revenue Agency (CRA) provided guidance where shares of a private company are passed on to the children of the deceased. The CRA…
The Canada Revenue Agency (CRA) was asked whether compensation received by an individual acting under a power of attorney (POA) is required to be included in the individual’s income for income tax purposes. A POA is a legal document between two persons whereby one person (A) appoints another person and…
Without proper tax planning, private company shareholders face the prospect of a double tax on the value of shares – once at the time of death and again when the successor beneficiaries extract the share value from the company. Post mortem “pipeline” planning solves this problem by allowing the estate…
In an earlier post I provided general reporting information that applies to taxpayers who participated in what reasonably appeared to be a legitimate investment for income tax purposes and turned out to be a fraudulent investment scheme. The economic losses in these situations can be devastating when compounded by the…
Suppose the will of a deceased taxpayer provides that certain assets are to be transferred to a spousal or common law partner trust. Before doing so, and while property of the estate is being administered, certain property might change or be substituted by the Estate. For example, shares might be…