All About Estates

Category: Tax Issues

Total 178 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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Individual Pension Plans Revisited (Again) – What about Pension Transfers?

When a member of an employer sponsored pension plan ceases employment, the member may receive a lump sum payment for the commuted value of their pension rights, exposing that member to a significant tax bill, as only a limited amount of the payment can be transferred to an RRSP. There…

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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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Pipelines and non-resident beneficiaries

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…

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Disability Tax credits and Bankruptcy

In general, unpaid and to be paid disability tax credits can form part of a bankrupt’s estate in the form of property and income. If they are “property of the bankrupt” within the Bankruptcy and Insolvency Act, (the “BIA”), then they are 100% distributable amongst estate creditors in accordance with…

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Fraudulent investment—recourse options

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…

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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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Spousal Rollover and Substituted Property

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…

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