It’s Giving Season: Tax Credits for Charitable Donations vs. Political Contributions
By: Alexandra Tzannidakis In the public mind, the idea of tax credits for giving to ‘good causes’ sometimes leads to confusion and conflation of charitable tax credits and political tax credits. The truth is that charities and political causes are legally very distinct concepts (there is no such thing as a political charity) and although an individual can get tax credits for donating to both, the schemes that govern the reporting and calculation of these credits are quite different. With the holiday season upon us,…
Considering Costs in Estate Litigation
A recent judgment from the Ontario Court of Appeal provides a good reminder to factor in the risk of paying costs before deciding whether to litigate a matter. In Sawdon Estate v Watch Tower Bible and Tract Society of Canada et al.[1], the court awarded a type of ‘blended’ costs that are outside the usual rules of estate litigation cost awards. The judgment is also a good object lesson in the types of considerations a judge may take into account when deciding costs. The facts…
Guindon Case on Section 163.2 Penalties Headed to Supreme Court
By: Alexandra Tzannidakis The Supreme Court of Canada has granted Julie Guindon leave to appeal from a Federal Court of Appeal decision that held section 163.2 penalties against tax advisers are not “penal” and therefore do not attract section 11 Charter rights. Our readers may recall that we have written about this important case in the past.[1] Ms. Guindon was assessed penalties amounting to $564,747 under section 163.2 of the Income Tax Act on the basis that she knew or would have known but for…
The Dire Consequences of Failing to ‘Continue’ to the New Federal Not-for-profit Corporations Act
Advisers acting for federal not-for-profit corporations take heed: you have a deadline of October 17, 2014, by which to switch over (or “continue”) to the new Canada Not-for-profit Corporations Act. The changeover period has been running since 2011 and this year is your last chance to comply… and yet, less than 10% of affected corporations have actually taken the plunge. So, let us put this another way. On October 18, 2014, Corporations Canada will start dissolving corporations. How Dissolution Will Work Dissolutions will be based…
Suing the Tax Man
by: Alexandra Tzannidakis EquiGenesis Corporation and its owner, a corporate commercial lawyer by the name of Kenneth Gordon, have filed a statement of claim against the CRA and one of its senior auditors. The corporation is claiming substantial damages from the CRA for intentional delays and disregard of its own policies that injured EquiGenesis’s business. For anyone who has ever experienced hair-pulling levels of frustration from CRA delays (all of us), this lawsuit offers a bit of vicarious fantasizing. We’ve endeavoured to summarize the lengthy…
New Hope for Taxpayers Caught in Charitable Donation Tax Shelter Schemes
By: Alexandra Tzannidakis In November 2012, the Tax Court of Canada added an interesting new twist to the epic story of Canada Revenue Agency versus tax shelters with its decision in Berg v The Queen.[1] The story is an old one. Every year, many Canadian taxpayers are seduced by the quick profit and respectable veneer of tax shelter schemes that turn on charitable donations. In return for fees paid to a promoter, they are offered a way to cut their taxes via inflated charitable donation…
Why Jurisdiction Matters to Corporate Finances: CNCA vs. ONCA
While Federal not-for-profit corporations are still adjusting to the new Canada Not-for-profit Corporations Act (CNCA), their Provincially-incorporated counterparts in Ontario are about to face a similar change when the Ontario Not-for-profit Corporations Act(ONCA) comes into force later this year. The two pieces of legislation are similar-yet-different enough to confuse the uninitiated. Their slightly misaligned schemes of financial review are particularly complex, but are well worth taking the time to understand. The circumstances in which corporations are required to undertake a costly yearly audit are not quite the same…
New Canadian Anti-Spam Laws on the Horizon
By: Alexandra Tzannidakis Back in 2010, Bill C-28 (Fighting Internet and Wireless Spam) was passed by Parliament and received royal assent. It was expected to come into force in 2012, but delays in drafting the regulations mean that 2012 has come and gone without a coming-into-force date having been announced. This delay gives Canadian businesses, and any foreign entities that do business with Canada, more time to carefully consider what the legislation will require of them. The government will also grant a period between the…