All About Estates

Category: Investments

Total 76 Posts

Is a Sale for $1 the Same as a Gift?

Most transactions between parties not at arm’s length with each other (often described as related parties, such as family members), the parties to the transaction are subject to a one-sided adjustment where the transaction proceeds does not equal fair market value (“FMV”). If the price exceeds FMV, then the cost…

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Significant Tax Re-Assessment Due to An Estate Valuation Gone Wrong

I have been writing about valuations for estate plan agreements, highlighting that they should be based on fair and reasonable methods, prepared in good faith, properly supported and documented at the time of valuation. In Lewin v. the Queen 2019 TCC 21, The Lewin Estate was appealing a significant tax…

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SPOUSAL TRUSTS : COUPLE OF UPDATES

Life insurance policy – rollover at cost? In a recent technical interpretation, the Canada Revenue Agency (“CRA”) confirmed that where a spousal trust is required to pay the life insurance premiums on a policy it owns and is the beneficiary of the policy, a rollover at cost pursuant to the…

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When Cash is not King?

Most people keep their cash in bank accounts. However, to my surprise, some people still don’t, and for estate planning and administration purposes, this can be a real problem. Take the case of Temple v. Peddle, 2019 NLCA 2 in Newfoundland Labrador. Mrs. Peddle kept cash in a safe deposit…

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Estate Applied to Have Filings Made by Taxpayer Lacking Mental Capacity Set Aside

In Ntakos Estate v. The Queen, 2018 TCC 224, a family business was owned by the deceased taxpayer, Anna (after her husband passed away in 1995) with two brothers-in-law through a holding corporation. Anna’s mental and physical health declined from 1995 until her death in 2004. She was diagnosed in…

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Amendments to the CBCA: Implications for the Valuation of Interests in Trusts?

Amendments to Canada Business Corporations Act (“CBCA”), will come into force mid-2019 which will require each private CBCA corporation to maintain a register listing the actual individuals (i.e., physical persons with name, address and date of birth and tax jurisdiction) with significant control in fact over the corporation including individuals…

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Capital Gains Exemption Purification before a Share Sale: Be Careful about Timing

Assume a family trust (“Trust”) which has a December year end owns 100% of an operating company (“opco”). A separate corporation (“holdco”), owned by the founders of opco, is a corporate beneficiary of the Trust. Opco is up for sale. Opco has excess funds which may affect the Trust’s and…

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Charitable Donations – What Do You Get in Return?

Each December, we are reminded that this is the season of giving. As we are encouraged to lend our support to worthy causes, it is helpful to understand the extent to which donors can control the use of their funds and oversee the direction of a charitable project. Meddling in…

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Requirement to File a Tax Return Expanded

As written previously, the requirement to file a tax return for trusts has been expanded. Thanks to new legislation, there are now exceptions to the exception to file. Generally speaking, a trust (other than a trust established by law or judgment) that is resident in Canada must file a tax…

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Source of Income and the TOSI Rules: Clarification?

Since the Tax on Split Income (“TOSI”) legislation was released, there has been considerable consternation amongst professionals as to how the rules apply. Even the most sophisticated readers of the legislation agree that it contains provisions that are both ambiguous and somewhat complicated. Somewhat out of exasperation, many deal with…

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