,canada ,cu/oms #a & ,rev5ue ,ag5cy ,m ,ways 6,s]ve ,y6 ,9come ,tax ,te*nical ,news ,numb] #bb ,janu>y #aa1 #bjjb ,9 ,? ,issue ,? issue pres5ts ! text (! topics 4cuss$ at a panel at ! annual 3f];e (! .,canadian .,tax .,f.d,n held on ,septemb] #bc 6#be1 #bjja1 9 ,vanc\v]4 ,! responses 6! "qs 7 giv5 0,mr4 ,roy ,%ultis1 ,deputy ,assi/ant ,-mis.n]1 & ,mr4 ,m>c ,vanasse1 ,director (! ,busi;s & ,"pn]%ips ,divi.n1 (! ,9come ,tax ,rul+s ,directorate1 ,canada ,cu/oms & ,rev5ue ,ag5cy4 #a  ,te*nical news a#a ,! topics 4cuss$ 7 ! foll[+3 ,g5]al ,anti-,avoid.e ,rule 7,,gaar7 ,employee ,b5efits ,rectific,n ,ord]s ,%>ehold]/,manag] ,remun],n ,l>ge ,corpor,n ,tax--,capital ,tax ,cases ,limit,n ,laws on ,collec;n ,ac;ns ,tax ,%elt] ,news ,rel1se--,rul+s ,posi;n ,-mis.n ,9come ,transf]r$ 6,corpor,n ,s]ies ( ,transac;ns ,9t]n,nal ,tax,n ,! ,9come ,tax ,te*nical ,news is produc$ 0! ,policy & ,legisl,n ,bran*4 ,x is provid$ = 9=m,n purposes only & does n replace ! law4 ,if y h any -;ts or su7es;ns ab ! matt]s 4cuss$ 9 ? public,n1 pl1se s5d !m to3 #b  ,te*nical news b#a ,manag]1 ,te*nical ,public,ns & ,projects ,sec;n ,9come ,tax ,rul+s ,directorate ,policy & ,legisl,n ,bran* ,canada ,cu/oms & ,rev5ue ,ag5cy ,ottawa ,,on ,k#a;,a #j;,l#e ,! ,9come ,tax ,te*nical ,news c 2 f.d on ! ,canada ,cu/oms & ,rev5ue ,ag5cy ,9t]net site at _+www.ccra.gc.ca_: ,g5]al ,anti-,avoid.e ,rule 7,,gaar7 ,"q #a ,until ! rec5t ,f$]al ,c\rt ( ,app1l deci.n issu$ la/ week on ,,osfc ,hold+s ,ltd4 v4 ,! ,que5 7#bjja ,,dtc #edga71 ! ,,ccra _h lo/ a few tax c\rt deci.ns on ! g5]al anti-avoid.e ,rule 7,,gaar74 ,w ^! rec5t cases *ange ! way ! ,,ccra issues ,,gaar assess;ts8 #c  ,response #a c#a ,y >e correct t 2f ,,osfc we _h lo/ a few ,,gaar deci.ns4 ,! ,f$]al ,c\rt ( ,app1l has n[ provid$ guid.e ) _! deci.n 9 ! ,,osfc case4 ,x approa*$ ! 9t]pret,n ( sec;n #bde 9 a way t is 3si/5t )! approa* us$ 0! ,,ccra4 ,s1 my message td is t x is busi;s z usual 9 \r adm9i/r,n ( ,,gaar4 ,"q #b ,9 view (! ,canadian ,pacific ,ltd4 v4 ,! ,que5 7#bjjj ,,dtc #bdbh1 ,7#bjja7' #a ,,ctc #baij71 ,d5nis ,g]ansky v4 ,! ,que5 7#bjja ,,dtc #bdc1 ,7#bjja7' #b ,,ctc #badg7 & ,husky ,oil ,ltd v4 ,! ,que51 7#ii ,,dtc #cjh1 ,7#aiii7' #d ,,ctc #bfia7 deci.ns1 w ! ,,ccra 3sid] "! 6be an avoid.e transac;n :5 a taxpay] c %[ t "! is an ov]all busi;s purpose =! transac;ns or has ! ,,osfc deci.n ov]turn$ t 3cept8 #d  ,response #b d#a ,no1 we d n a3ept t a s]ies ( transac;ns _c 3ta9 an avoid.e transac;n :5 "! is a prim>y busi;s purpose =! s]ies4 ,"! is a /ate;t 9 --------------------------------------#b ! #aihh ,te*nical ,notes : 9troduc$ subsec;n #bde7#c7 6! e6ect t3 8,": a s]ies ( transac;ns wd result 9 a tax b5efit1 t tax b5efit w 2 d5i$ un.s ! prim>y objective ( ea* transac;n 9 ! s]ies is 6a*ieve "s legitimate non-tax purpose04 ,we h 9t]pret$ ! rule 9 ? way4 ,! deci.n 9 ,,osfc ma9ta9$ \r posi;n t 9 ord] n 6be an 8avoid.e transac;n0 9 subsec;n #bde7#c71 ea* /ep 9 a s]ies ( transac;ns m/ 2 c>ri$ \ prim>ily = bona fide non-tax purposes4 ,"q #c ,if we _c get \ ( ,,gaar us+ ! ov]all busi;s purpose pr9ciple1 c we rely on ! #e  7,,gaar7 a#b 8*oice ( me?od0 pr9ciple z describ$ 0judge ,b[man 9 ! ,g]ansky deci.n8 ,response #c ,9 ,g]ansky1 ! ,tax ,c\rt held t nei subsec;n #hd7#b7 nor ! ,,gaar appli$ 6! transac;ns 9 "q4 ,we d n 2lieve t "! is a 8*oice ( me?od0 pr9ciple 9 ! ,g]ansky deci.n4 ,z m5;n$1 ! ,,ccra does n a3ept ! f9d+ (! ,tax ,c\rt ,judge t a s]ies ( transac;ns _c 3ta9 an avoid.e transac;n if "! is a prim>y non-tax purpose =! s]ies ( transac;ns4 ,! ,,osfc judg;t 3firms t ? posi;n is correct4 ,x is not$ t ! ,,osfc deci.n /at$ t "! is no g5]al rule ag/ /ructur+ transac;ns 9 a tax e6ective mann] or a require;t t transac;ns 2 /ructur$ 9 a mann] t maximizes tax4 ,h["e1 x w5t on 6say t ! ,,gaar may / apply if ! transac;ns result 9 an abuse (! ,act4 #f  ,"q #d b#b ,9 lid =! applic,n (! 8abuse or misuse0 te/4 ,9 ord] 6apply ! ,,gaar1 ! c\rt /at$ t ! onus is on ,,ccra 6%[ a cle> & unambigu\s policy (! relevant provi.ns (! ,act r1d z a :ole & 6set \ :at extr9sic aids 7 reli$ ^u s t x is su6ici5tly cle> t ! use made (! provi.n or provi.ns 0! taxpay] 3/itut$ a misuse or abuse4 ,? is "o (! r1sons =! pres;e (a s5ior (ficial f ! ,de"p;t ( ,f9.e on ! ,,gaar -mittee4 ,9 ? reg>d1 \r tax avoid.e auditors h exi/+ 9/ruc;ns 6provide ! taxpay] ) #g  7,,gaar7 c#b ,,ccra's view ( :y ! transac;ns "u review >e subject 6,,gaar4 ,"q #e ,! ,,osfc deci.n w und\bt$ly give tax avoid.e auditors renew$ z1l 6apply ! ,,gaar4 ,>e "! any important process *anges t we %d 2 aw>e ( 3c]n+ ! applic,n (! ,,gaar8 ,response #e ,i d n 2lieve t ! ,,osfc deci.n w *ange ! 2havior ( \r tax avoid.e auditors s9ce ! pr9ciples 4cuss$ 9 t deci.n >e 3si/5t )! pr9ciples t we h us$ 9 apply+ ! ,,gaar4 ,z f> z process *anges1 ,mr4 ,bill ,bak]1 ,assi/ant ,-mis.n] (! ,-pli.e ,programs ,bran*1 ann\nc$ e>li] t ,mr4 ,patrick ,boyle w 2 on an executive 9t]*ange assign;t )! ,,ccra & w sit on ! ,,gaar ,-mittee z "p ( 8 duties4 ,i #h  7,,gaar7 d#b ?9k ? %[s t we >e li/5+ 6! tax -mun;y & ,mr4 ,boyle's pres;e w provide a private sector viewpo9t4 ,al1 ,messrs4 ,bill ,bak] & ,bill ,mc,closkey1 ,assi/ant ,-mis.n] (! ,policy & ,legisl,n ,bran*1 h ask$ me 6take ov] z *air (! ,,gaar ,-mittee4 ,mr4 ,mike ,hiltz1 al;g ) my o!r directors 9 ,rul+s1 ,messrs4 ,m>c ,vanasse1 ,rick ,bisc>o & ,brian ,d>l+1 w support me 9 ? role4 ,i ?9k t ! adm9i/r,n ( ,,gaar has be5 well manag$4 ,! ,,gaar ,-mittee 5sures a c5traliz$ 3trol1 prop] delib],n & 3si/5cy & x has be5 my exp]i;e t \r tax avoid.e auditors >e "s (! be/ 9 \r organiz,n & d a responsi# job4 ,/&+ 9/ruc;ns 6\r auditors 5sure t no case w 2 he>d 0! ,,gaar ,-mittee un.s -plete taxpay] repres5t,ns a3ompany ! ref]ral4 ,i ?9k x is al important 6"u/& t tax avoid.e auditors d n approve ,,gaar assess;ts1 ! ,,gaar ,-mittee m/ approve all ,,gaar assess;ts & to-date1 ,,gaar #i  7,,gaar7 e#b has only be5 recomm5d$ on #cbj files s9ce 9cep;n4 --------------------------------------#c ,"q #f ,s if we c expect ,,gaar assess;ts 63t9ue1 j :at >1s >e ! ,,ccra auditors look+ at :5 apply+ ! ,,gaar8 ,response #f ,9 g5]al t]ms1 ! top five >1s ": ! ,,gaar has be5 appli$ >e3 --,avoid.e ( l>ge corpor,n ,"p ,i4#c tax2 --,divid5d /ripp+2 --,\tb.d 9direct loans2 --,tr1ty %opp+2 & --,pd-up capital %ift+/cre,n4 #aj  ,avoid.e ( l>ge corpor,n ,"p a#c ,i4#c tax ,^! cases g5],y 9volve a tempor>y acquisi;n & 4posi;n 7ov] a corpor,n's ye>-5d7 ( assets eligi# =! 9ve/;t all[.e s z 6reduce ,"p ,i4#c tax4 ,! assets tempor>ily acquir$ yield a rate ( return l[] ?an ! assets ord9>ily held4 ,a case on ,"p ,i4#c tax 0 he>d 9 ,calg>y 9 ,may #bjja4 ,divid5d /ripp+ ,an 9dividual sells %>es ( 8 corpor,n 6a ,newco & claims ! capital ga9 deduc;n4 ,corporate assets >e transf]r$1 g5],y on a taxa# basis1 6! ,newco4 ,! %>es (! new corpor,n >e sold = no ga94 ,! ,g]ansky case provides an example ( s* transac;ns4 #aa  ,\tb.d 9direct loans b#c ,^! cases 9volve ! use (a newly cr1t$ -pany 9 a tax hav5 6all[ a ,canadian -pany 6make 9direct loans 6(f%ore -panies t >e n =eign a6iliates (! ,canadian -pany4 ,if ! loan _h be5 direct1 "! wd 2 an 9t]e/ 9come 9clu.n 6! ,canadian -pany pursuant 6p>agraph #ab7#a77c71 & subsec;n #ae7#b7 wd apply 6! loan result+ 9 ,"p ,,xiii tax 6! non- resid5t4 ,tr1ty %opp+ ,we h be5 review+ cases 9volv+ ! 3t9u.e (a taxpay] f "o tr1ty c.try 6ano!r 9 ord] =! taxpay] 6b5efit f a l[] tr1ty rate on receipt (a pay;t4 ,we >e al see+ cases 9volv+ ! 3t9u.e ( taxpay]s f non-tr1ty c.tries 96tr1ty c.tries 9 ord] 6obta9 an exemp;n f capital ga9s >is+ on a sale ( prop]ty4 ,canada takes ! view t x is free 6apply xs dome/ic anti-avoid.e #ab  7,,gaar7 c#c rules 6c.t] abusive tr1ty-%opp+ >range;ts4 ,pd-up capital %ift+/cre,n ,^! s*emes cd 2 view$ z a subset ( surplus /ripp+4 ,taxpay]s "utake amalgam,ns 6use subsec;n #hg7#c7 6%ift pd-up capital f tax-9di6]5t %>ehold]s 6o!r %>ehold]s4 ,"q #g ,>e any busi;s transac;ns re,y safe f ! ,,gaar8 ,response #g ,o!rs >1s ": ! ,,gaar has be5 f.d n 6apply 9clude3 --,in-h\se loss utiliz,n 7g5],y ^! >range;ts >e n 3sid]$ a misuse or abuse1 b ,i hi,n ( busi;s activities 6maximize ! manufactur+ & process+ deduc;n/sci5tific rese>* & exp]i;tal develop;t 9c5tives4 ,in-h\se loss utiliz,n ,! exi/;e ( specific provi.ns p]mitt+ ! transf] ( losses & o!r deduc;ns 2t relat$ corpor,ns & ref];es 9 ! explanatory notes relat+ 69come tax re=m 9dicate t a loss utiliz,n (! type 9 "q is 3si/5t )! s*eme (! ,act &1 "!=e1 subsec;n #bde7#b7 wd n 2 appli$4 ,=eign prop]ty ,"o use 9volv$ ! use ( f9ancial derivatives 6mimic a rate ( return equival5t 6t on =eign prop]ty4 ,o!r #ad  7,,gaar7 e#c files 9volv$ ! acquisi;n ( prop]ties t >e n li/$ z =eign prop]ty 9 --------------------------------------#d ! ,act 7e4g41 debts (a tru/ 9 c]ta9 circum/.es74 ,don,n tax cr$its ,g5],y1 ^! s*emes >e n subject 6,,gaar z o!r provi.ns (! ,act may 2 us$ 6*all5ge !m4 ,h["e1 transac;ns 9volv+ ! transf] ( corporate don,n tax cr$its 7 f.d n 6be subject 6! ,,gaar4 ,sep>,n ( busi;s activities 6maximize ! manufactur+ & process+ deduc;n/sci5tific rese>* & exp]i;tal develop;t 9c5tives ,segregat+ activities 9 sep>ate corpor,ns 6maximize ! 9c5tives availa# "u ! ,act is n 3sid]$ 6be an abuse (! ,act r1d z a :ole4 #ae  ,"q #h a#d ,9 view (! deci.n 9 ,r\ss1u-,h\le v4 ,! ,que5 7#bjja ,,dtc #bej71 w ,,ccra take ! posi;n t ,,gaar does n apply 6! ,regul,ns8 ,response #h ,no4 ,employee ,b5efits ,! ,,ccra has rec5tly lo/ a case d1l+ ) :e!r free p>k+ provid$ 6employees 3/itutes a taxa# employ;t b5efit4 ,9 ! case ( ,daniel ,q4,s4 ,*[ & ,brian ,tope*ka v4 ,! ,que5 7#bjja ,,dtc #afd1 ,7#bjja7' #a ,,ctc #bgda71 ! 9dividuals 7 employ$ z mi4le manag]s ) ,telus ,manage;t ,s]vices ,9c4 ,! employ] provid$ !m ) free p>k+ at xs p>k+ g>age locat$ next 6! loc,n ": ! employees "w$4 ,mr4 ,*[ "w$ until #h3jj mo/ ev5+s & public transport,n 0 n easily #af  ,employee b5efits b#d a3essi# at t "t4 ,simil>ly1 ,mr4 ,tope*ka />t$ "w at #e3jj 9 ! morn+ & cd n avail hmf ( public transit at t e>ly h\r4 ,! employ] wd reimburse ! co/ ( taxis 9 ^? situ,ns ": an employee 0 requir$ 6/>t e>ly or "w late4 ,0provid+ free p>k+ 9 ^! cases1 ! employ] did n 9cur any extra taxi exp5ses1 & x b5efit$ f hav+ ! employees availa# 6"w 9 ! e>ly & late h\rs4 ,! c\rt f.d t "! 0 no b5efit 2c ! prim>y b5efici>y (! free p>k+ 0 ! employ] 9 ? situ,n4 ,"q #a ,does ! ,,ccra agree ) ? case8 ,response #a ,f/ ( all1 let me /ate t ! ,,ccra recognizes ! adm9i/rative burd5 = employ]s :5 d1l+ ) employee b5efits4 ,we "!=e ne$ 6take r1sona# posi;ns )\t #ag  ,employee b5efits c#d -promis+ ! ov]all purpose (! tax+ provi.ns4 ,) respect 6? "picul> case1 x 0 he>d "u ! 9=mal proc$ure &! deci.n 0 bas$ on xs specific facts4 ,we feel t ? deci.n w 2 limit$ 9 xs applic,n 2c (! "picul> facts4 ,ess5ti,y1 x 0 decid$ t ! employ]-pd p>k+ b5efit$ ! employ] m ?an ! employee4 ,"q #b ,h[ does ! deci.n 9 ? case impact ! ,,ccra's posi;n on employ]-provid$ p>k+8 ,response #b ,we d n feel t ! deci.n *anges \r policy on employ]-provid$ p>k+4 ,! ,employ]s' ,guide--,taxa# ,b5efits is q cle> & basic,y /ates3 --t :5 an employ] provides free or subsidiz$ p>k+1 ! employee is 3sid]$ 6h rcvd an employ;t #ah  ,employee b5efits d#d b5efit bas$ on ! ,,fmv (! p>k+ spot2 --we recognize t "! may 2 situ,ns ": ! ,,fmv (! employ]-provid$ p>k+ is di6icult 6det]m9e1 s* z ": free p>k+ is g5],y availa# 6employees &! g5]al public1 or :5 "! is a limit$ numb] ( p>k+ spaces & p>k+ is on a f/ -e1 f/ s]ve basis4 ,9 ^! cases1 no b5efit w >ise2 --": ! p>k+ is provid$ = busi;s r1sons1 &! employee is regul>ly requir$ 6use _! vehicle = employ;t-relat$ purposes1 ! employee w n 2 3sid]$ 6h rcvd a taxa# b5efit4 ,"q #c ,audit+ employee b5efits & try+ 6det]m9e valu,ns = small employee b5efits m/ 2 an adm9i/rative burd5 =! ,,ccra & c]ta9ly is "o = employ]s4 ,is ! #ai  ,employee b5efits e#d ,,ccra plann+ 6review xs approa* 6! tax,n ( employee b5efits 9 g5]al8 --------------------------------------#e ,response #c ,! ,,ccra 3ducts an ongo+ review (! v>i\s b5efits & privileges provid$ 6employees1 65sure t \r posi;ns on tax,n >e fair 6all employees1 & 3si/5t )! legisl,n4 ,we ma9ta9 an op5 dialogue ) 9t]e/$ gr\ps s* z ! ,canadian ,payroll ,associ,n & adju/ \r policies f "t 6"t 6reflect curr5t economic r1l;y & busi;s practices4 ,z a result ( ? ongo+ review1 ,i am pl1s$ 6ann\nce t we >e mod]niz+ \r posi;n on ! tax,n ( employ]-provid$ gifts & aw>ds4 ,"q #d ,2f y get 96expla9+ ? ann\nce;t1 cd y briefly expla9 ! old posi;n8 #bj  ,response #d a#e ,"u \r exi/+ posi;n1 an employ] may give an employee1 on a tax-free basis1 "o gift p] ye> 7two 9 ! ye> ( m>riage7 =a special o3a.n s* z ,*ri/mas or a bir?"d1 if ! gift's value is less ?an 4#ajj &! employ] does n deduct x z a busi;s exp5se4 ,) respect 6aw>ds giv5 6employees 9 recogni;n ( c]ta9 a*ieve;ts1 ! fair m>ket value (! aw>d is g5],y 3sid]$ 6be a taxa# employ;t b5efit4 ,"u \r new posi;n1 employ]s w 2 a# 6give two non-ca% gifts p] ye>1 on a tax-free basis1 6employees = special o3a.ns s* z ,*ri/mas1 ,hanukkah1 bir?"d1 m>riage or a simil> ev5t ": ! a7regate co/ (! gifts 6! employ] is less ?an 4#ejj p] ye>4 ,simil>ly1 employ]s w 2 a# 6give employees two non-ca% aw>ds p] ye>1 on a tax-free basis1 9 recogni;n ( special a*ieve;ts s* z r1*+ a set numb] ( ye>s ( s]vice1 meet+ or exce$+ safety #ba  ,employee b5efits b#e /&>ds1 or r1*+ simil> mile/"os ": ! total co/ (! aw>ds 6! employ] is less ?an 4#ejj p] ye>4 ,! employ] w 2 a# 6deduct ! co/ (! gifts & aw>ds4 ,? new posi;n 0 develop$ af ext5sive 3sult,n1 reflects curr5t busi;s practices & is 9 keep+ ) o!r r1sona# posi;ns t we h set \ 9 \r ,9t]pret,n ,bullet9 ,,it-#dgj1 ,employees' ,fr+e ,b5efits4 ,x makes x easi] = employ]s 6adm9i/] 2c x removes ! burd5 ( det]m9+ ! fair m>ket value ( small gifts & aw>ds --"s?+ t is v subjective :5 ! gift or aw>d has a -pany logo4 ,? new posi;n w 2 closely monitor$ & w 2 adju/$ if abuse or undue rev5ue loss is id5tifi$4 ,"q #e ,wd gift c]tificates 2 3sid]$ non-ca% gifts & aw>ds = purposes ( ? new posi;n8 #bb  ,response #e c#e ,! posi;n wd n apply 6ca% or ne>-ca% gifts & aw>ds4 ,acly1 gift c]tificates1 gold nu7ets1 or any o!r item t c easily 2 3v]t$ 6ca% wd n fall )9 ! new posi;n1 &! value ( s* aw>ds & gifts w 2 3sid]$ a taxa# employ;t b5efit4 ,"q #f ,:at happ5s if ! total co/ (! gifts or aw>ds1 z ! case may be1 exce$s ! 4#ejj limit8 ,response #f ,if ! co/ exce$s ! 4#ejj ?re%old1 !n ! full fair m>ket value (! gifts or aw>ds w 2 9clud$ 9 ! employee's employ;t 9come4 ,! purpose (! new posi;n is 6all[ employ]s 6provide small non-m"ot>y gifts & aw>ds 6employees )\t 9curr+ ! adm9i/rative burd5 ( valu+ ^! items = ,t#d report+ purposes4 ,if ! co/ #bc  ,employee b5efits d#e goes 2y ! 4#ejj limit1 ! assump;n is t ! gifts or aw>ds =m "p (! employee's remun],n package4 ,"q #g ,w ? new approa* a6ect ! policy on ,*ri/mas "pies & o!r social func;ns8 ,response #g ,no4 ,! policy applies only 6gifts & aw>ds giv5 6employees4 ,"q #h ,:5 does ? new posi;n -e 96e6ect8 ,response #h ,we w publi% ? new posi;n 9 an upcom+ ,te*nical ,news1 & x w 2 e6ective =! #bjja cal5d> ye>4 #bd  ,"q #i #f ,i r1lize t we cd sp5d all "d on ! issue ( taxa# b5efits 2c x is s* an important topic4 ,h["e1 ,i wd l 6ask y "o la/ "q4 ,we h notic$ t ov] ! la/ ye>1 y h issu$ rul+s t employ] provid$ home -put]s >e n taxa# b5efits4 ,cd y expla9 ! r,nale ( ^! rul+s8 ,response #i ,^! fav\ra# rul+s 7 bas$ on \r posi;n 9 ,te*nical ,news ,no4 #ac on employ]-pd $uc,n & tra9+ co/s4 ,ess5ti,y1 \r posi;n is t "! is no taxa# b5efit ": ! tra9+ is tak5 prim>ily =! b5efit (! employ]4 ,9 ! rul+s giv51 we analyz$ ! employ]- sponsor$ tra9+ programs t 7 availa# 6all employees =! purpose ( develop+ _! -put] & ,9t]net skills4 ,! programs 9 "q 7 view$ z b5efit+ ! employ] m ?an ! employees4 ,we >e prep>$ 6analyze any employ]- sponsor$ tra9+ program 9 ! 3text ( #be  ,employee b5efits a#f an adv.e 9come tax rul+ reque/1 6det]m9e if x is 3si/5t ) \r posi;n 9 ,te*nical ,news ,no4 #ac4 ,rectific,n ,ord]s ,"q #a ,w ! ,,ccra a3ept all rectific,n ord]s = assess+ & reassess+ purposes8 ,response #a ,\r policy on rectific,n is / evolv+4 ,h["e1 at ? po9t1 giv5 ! deci.ns 9 ,pet] & ,b]n>d ,dale v4 ,! ,que5 7#bjjj ,,dtc #fegi1 ,7#bjjj7' #d ,,ctc #ahd7 & ,! ,que5 v4 ,sussex ,squ>e ,a"p;ts ,ltd4 7#bjjj ,,dtc #fedh1 ,7#bjjj7' #d ,,ctc #bjc71 we w norm,y a3ept rectific,n ord]s1 especi,y :5 we h _h an opportun;y 63te/ ! ord] 9 ,prov9cial ,c\rt z )! ,paul & ,k>5 ,juli> v4 ,! ,attorney ,g5]al ( ,canada 7#bjjj ,,dtc #bf  ,rectific,n ord]s b#f #fehi7 case4 ,h["e1 ,i wd l 6add two important qualific,ns3 #a4 ,if we >e n prop]ly 9=m$ ab ! rectific,n applic,n1 \r reac;n w 2 63te/ ! rectific,n ord] 9 ,prov9cial ,c\rt4 #b4 ,if we ?9k ! process has be5 abus$1 we w 3sid] tak+ ! "r case "? ! ,tax ,c\rt process4 ,"q #b ,h any 9/ruc;ns be5 issu$ 6! field 3c]n+ rectific,n &! ,juli> deci.n4 ,response #b ,yes1 9 ,june ( ? ye>1 ,tax ,avoid.e 9 ,h1dqu>t]s issu$ 9t]im policy 9/ruc;ns 6all ( \r field (fices4 #bg  ,"q #c c#f ,abs5t a rectific,n ord]1 :at is ! ,,ccra's curr5t policy on a3ept+ *anges 6docu;ts or replace;ts ( docu;ts 9 li deci.n8 ,response #c ,9 ! abs;e (a valid rectific,n ord]1 we w assess on ! basis (! legal docu;ts &! legal "rs t !y cr1te4 ,auditors h no *oice b 6assess on ! facts pres5t at ! "t ( assess;t or audit4 ,h["e1 adju/;ts w / 2 made 6correct cl]ical or adm9i/rative ]rors = ,sec;n #he rollov]s z set \ 9 p>agraph #af ( ,9=m,n ,circul> #gf-ai;,r#c4 ,"q #d ,rectific,n ord]s >e us$ 6correct ]rors4 ,:at is ! ,,ccra's 3c]n ) obta9+ a rectific,n ord] f ! ,prov9cial ,c\rt8 #bh  ,response #d d#f ,i r1lize t tax practi;n]s see ! ,juli> deci.n z gd news = taxpay]s :o make h"o/ mistakes 9 /ructur+ & c>ry+ \ _! transac;ns4 ,n"e!.s1 we h legitimate 3c]ns 9 ? >ea4 ,we feel /r;gly t obta9+ a rectific,n ord] %d n 2come a 3v5i5t me?od ( 8fix+0 a7ressive tax plans t >e uncov]$ on audit4 ,x is no surprise t we d n 3d"o retroactive tax plann+4 ,we >e n z 3c]n$ ab correct+ docu;t,n t is 9 ]ror 2c x does n reflect ! true 9t5;n (! "pies 9volv$4 ,? is :at we 2lieve ! doctr9e ( rectific,n 3templates4 ,9 any ev5t1 we want 6be 9=m$ ( any applic,n =a rectific,n ord]4 ,if n1 we w ask ,ju/ice 6take ! nec /eps 6op5 ! ord]4 ,? is 9 fact :at has be5 d"o 9 a few cases & hope;lly we w rcv m guid.e f ! c\rts on rectific,n4 #bi  ,"q #e #g ,:5 w ! ,,ccra oppose a rectific,n ord] 9 ,prov9cial ,c\rt8 ,response #e ,\r g5]al policy is t ": ! am5d;ts >e 9tegral 6a*iev+ ! orig9al 9t5;ns (! "pies1 ! applic,n = rectific,n likely w n 2 oppos$4 ,h["e1 ,i wd cau;n y t rectific,n %d n 2 se5 z a sub/itute = profes.nal 9sur.e4 ,! ?re%old = obta9+ a rectific,n ord] is q hi<4 ,! c\rt w h 6be p]suad$ t ! docu;t,n (! transac;ns 9 "q does n reflect ! true & prim>y 9t5;ns (! "pies4 ,we w rely on ,ju/ice 6advise u : cases meet ! doctr9e ( rectific,n4 ,! mo/ likely >1s ": we may oppose applic,ns 6obta9 rectific,n >e ":3 --! taxpay] has no evid;e z 6! 9itial -mon 9t5d$ transac;n or "! is evid;e 6%[ t "! 0 n ano!r 9t5;n2 or #cj  ,rectific,n ord]s a#g --! taxpay] is ask+ ! c\rt n 6rectify ! transac;n back 6xs 9t5d$ =m1 b 6undo ! 9t5d$ transac;n & put 9 place a new "o =m$ af ! orig9al transac;n4 ,we wd n *all5ge ! 8corporate slip0 type ( mistake1 z 9 ! ,dale case1 nor wd we *all5ge a case t fits squ>ely )9 ! facts (! ,juli> deci.n4 ,al?1 z ,mr4 ,ian ,mc,gregor expla9$ 9 ! op5+ ses.n (! 3f];e1 we >e limit+ ,juli> 6xs "picul> facts4 ,x 0 se5 z a sympa!tic case4 ,"q #f ,w ! ,,ccra seek legislative *anges 3c]n+ rectific,n8 ,response #f ,we >e pres5tly monitor+ ! numb] & types ( rectific,n applic,ns & ord]s & w rcv fur!r guid.e f ! c\rts on ! #ca  ,rectific,n ord]s b#g cases t >e pres5tly "u 3sid],n &1 bas$ on t1 w det]m9e if a legislative am5d;t is desira#4 ,z s*1 \r posi;n on rectific,n has yet 6be f9aliz$4 ,%>ehold]/,manag] ,remun],n ,= ov] #bj ye>s1 _m ,canadian-3troll$ private corpor,ns 7,,ccpc's7 h foll[$ a practice ( pay+ sal>ies & bonuses 6%>ehold]/manag]s 9 am.ts su6ici5t 6reduce ! taxa# 9come (! corpor,n 6or 2l ! limits t qualify =! small busi;s deduc;n4 ,? issue 0 a4ress$ at ! annual 3f];e (! ,canadian ,tax ,f.d,n 9 #aiha4 ,9 answ] 6"q #db (! ,r.d ,ta# ses.n1 x 0 /at$ t3 8,in g5]al1 ! r1sona#;s ( sal>ies & bonuses pd 6pr9cipal %>ehold]/manag]s (a corpor,n wd n 2 *all5g$ :53 --! g5]al practice (! corpor,n is 64tribute ! pr(its (! -pany 6xs #cb  ,%>ehold]/manag] c#g %>ehold]/manag]s 9 ! =m ( bonuses or a4i;nal sal>ies2 or --! -pany has adopt$ a policy ( dclg bonuses 6! %>ehold]s 6remun]ate !m =! pr(its ! -pany has e>n$ t >e attributa# 6special "k-h[1 3nec;ns or 5trepr5eurial skills (! %>ehold]s40 ,z a result ( rec5t te*nical 9t]pret,ns t 4cuss ! tr1t;t ( remun],n 69direct %>ehold]s1 "! has be5 "s 3c]n ov] h[ ! ,,ccra w tr1t remun],n pd 6employee/%>ehold]s4 ,"q #a ,9 liies & bonuses ref]r$ 6abv wd 2 appli$8 #cc  ,response #a d#g ,z a g5]al rule1 all exp5ses >e subject 6sec;n #fg4 ,h["e1 bas$ on ! specific situ,n t 0 pres5t$ dur+ ! #aiha ,r.d ,ta#1 we /at$ t we wd n *all5ge ! r1sona#;s ( sal>ies or bonuses 9 ! 3text (a ,,ccpc pay+ a bonus 6a %>ehold]/manag] 9 ord] 6reduce ! ,,ccpc's taxa# 9come 6! small busi;s deduc;n limit4 ,x is important 6note t 9 #aiha1 we m5;n$ bonuses 6! pr9cipal %>ehold]/manag]4 ,? 0 65sure we wd 2 tax+ ! sal>ies 9 ,canada4 ,? posi;n / applies td4 ,"q #b ,does ? posi;n apply 6sal>ies & bonuses pd 69active %>ehold]s8 --------------------------------------#h ,response #b ,no4 ,we w apply \r posi;n only 9 ! 3text (a ,,ccpc & active #cd  ,rectific,n ord]s a#h %>ehold]/manag]s :o >e resid5t 9 ,canada4 ,"q #c ,does ! use ( hold+ -panies a6ect ! ,,ccra's posi;n on ! r1sona#;s ( sal>ies & bonuses 6pr9cipal %>ehold]/manag]s8 ,response #c ,no4 ,we w n "q ! r1sona#;s (! pay;ts z l;g z ! sal>ies & bonuses >e pd 6manag]s :o >e %>ehold]s (! ,,ccpc 7ei directly or "? a hold+ -pany71 >e ,canadian resid5ts1 & >e actively 9volv$ 9 ! "d-to-"d op],ns (! -pany4 ,! key is t ! ,canadian resid5t recipi5ts m/ 2 active 9 ! op]at+ busi;s & 3tribute 6! 9come-produc+ activities f : ! remun],n is pd4 #ce  ,"q #d b#h ,i r1lize t ! "q 9 #aiha 0 q specific & t x d1lt ) pay+ a bonus 9 ord] 6reduce ! ,,ccpc's taxa# 9come 6! small busi;s deduc;n limit4 ,wd ! ,,ccra *all5ge ! r1sona#;s ( sal>ies & bonuses t result 9 ! ,,ccpc hav+ taxa# 9come 2l ! small busi;s deduc;n limit8 ,response #d ,no4 ,! ,,ccra wd n norm,y h any 3c]ns on r1sona#;s :5 sal>ies & bonuses >e pd 6active %>ehold]/manag]s (a ,,ccpc if !y >e ,canadian resid5ts active 9 ! 9come produc+ activities (! -pany4 ,"q #e ,does ! ,,ccra h pro#ms ) r1sona#;s ( sal>ies & bonuses :5 o!r family memb]s [n %>es (! ,,ccpc ei directly or "? a hold+ -pany or ev5 "? a tru/8 #cf  ,response #e c#h ,no4 ,z l;g z ! recipi5ts (! sal>ies & bonuses >e active %>ehold]/manag]s resid5t 9 ,canada1 we wd n *all5ge ! r1sona#;s (! am.t4 ,"q #f ,let me -plicate ? a ll bit4 ,wd ! ,,ccra *all5ge ! r1sona#;s ( 9t]- corporate manage;t fees pd 0,opco 6,holdco 7assum+ !y >e bo? ,,ccpc's78 ,response #f ,yes4 ,\r posi;n is limit$ 6sal>ies & bonuses pd directly 69dividuals resid5t 9 ,canada :o >e active %>ehold]/manag]s (a ,,ccpc4 ,we "!=e res]ve ! "r 6*all5ge ! r1sona#;s ( any 9t]-corporate manage;t fees4 #cg  ,"q #g d#h ,i r1lize t yr #aiha ,r.d ,ta# response implicitly d1lt ) active busi;s 9come e>n$ 0a ,,ccpc4 ,w ! ,,ccra ext5d ! posi;n 69clude ,,ccpc's t e>n non- active busi;s 9come8 ,response #g ,we w n norm,y *all5ge ! r1sona#;s ( sal>ies & bonuses pd \ ( non-active busi;s 9come z l;g z ! o!r pr9ciples t ,i m5;n$ abv >e adh]$ to 7i4e41 ! pay] is a ,,ccpc &! recipi5ts >e active %>ehold]/manag]s :o >e resid5t ( ,canada74 ,"q #h ,did ! deci.n 9 ,safety ,boss ,limit$ v4 ,! ,que5 7#bjjj ,,dtc #agfg1 ,7#bjjj7' #c ,,ctc #bdig7 *ange ! ,,ccra's posi;n on ! r1sona#;s ( sal>ies & bonuses8 #ch  ,response #h e#h ,no4 ,! ,safety ,boss case1 : 0 decid$ "u ! 9=mal proc$ures1 does n *ange \r posi;n 2c ! facts (! case >e n 3si/5t ) \r posi;n4 ,at ! "t (! pay;ts 9 "q3 --,safety ,boss ,limit$ 0 n a ,,ccpc2 --,! bonus 0 pd 6a %>ehold]/manag] :o 0 n a resid5t ( ,canada2 & --,! manage;t fees 7 pd 6a relat$1 non-resid5t corpor,n4 ,! ,,ccra "q$ ! r1sona#;s (! bonus & manage;t fees4 ,bas$ on ! "picul> facts (! case1 ! ,tax ,c\rt f.d t ! pay;ts 7 r1sona#4 --------------------------------------#i ,l>ge ,corpor,n ,tax--,capital ,tax ,cases ,"q ,s9ce ! ,,ccra has n s"\ l1ve 6app1l ! ,manufactur]s ,life ,9sur.e ,co4 v4 ,! ,que5 7#bjja ,,dtc #ecif7 #ci  ,l>ge corpor,n tax a#i 7,manulife7 deci.n1 w y n[ a3ept t g5]al a3.t+ & audit+ pr9ciples 7,,gaap7 det]m9e bo? ! am.t (! item reflect$ 9 ! f9ancial /ate;ts z well z ! "*iz,n (! item = purposes (! l>ge corpor,ns tax8 ,9 o!r ^ws1 ! ,,ccra m/ a3ept ! a3.t+ "*iz,n ( items t >e prop]ly reflect$ 9 ! f9ancial /ate;ts "u ,,gaap4 ,response ,! basic issue 9 ,manulife1 z well z 9 ,! ,que5 v4 ,royal ,tru/ ,corpor,n ( ,canada 7#bjja ,,dtc #eb1 ,7#bjja7' #c ,,ctc #bbfh7 & ,,pcl ,3/ruc;n ,manage;t ,9c4 v4 ,! ,que5 7#bjjj ,,dtc #bfbd1 ,7#bjja7' #a ,,ctc #bacb7 cases1 : >e pres5tly "u app1l 6! ,f$]al ,c\rt ( ,app1l1 is ! role ( ,,gaap 9 det]m9+ ! "* ( am.ts = ,"p ,i4#c purposes4 ,9 \r view1 x is ! 9t5t (! law 69clude 9 ! capital (a taxpay] ga9s t h be5 r1liz$ & "!=e =m "p (! availa# capital (! corpor,n4 ,simil>ly1 assets [n$ 0a #dj  ,l>ge corpor,n tax b#i taxpay] t >e l1s$ 0x 9 ! c\rse ( c>ry+ on xs busi;s cle>ly 3/itute tangi# prop]ty employ$ 9 ! taxpay]'s busi;s4 ,we recognize t ^! rec5t deci.ns h cr1t$ unc]ta9ty z 6! ,,ccra's posi;n t ! nature ( an am.t reflect$ 9 ! bal.e %eet is det]m9$ ) reg>d 6legal pr9ciples & is n limit$ 6! "*iz,n (! am.t = a3.t+ purposes4 ,z y "k1 ! ,supreme ,c\rt w only he> issues ( n,nal import.e4 ,)! assi/.e ( \r ,ju/ice advisors1 x 0 3clud$ t ,manulife did n raise an issue ( n,nal import.e & ?us1 we did n seek l1ve 6! ,supreme ,c\rt4 ,z a 3sequ;e1 ! ,,ccra w 2 assess+ ! implic,ns ( ? deci.n z x relates 6cases "u app1l &) reg>d 6\r posi;n express$ 9 ,,it-#ecb4 ,we w n h ! full picture until ! ,supreme ,c\rt h&s d[n xs deci.n 9 ! ,autobus ,?omas case1 : is s*$ul$ 6be he>d 9 mid-,octob]4 ,9 ,autobus ,?omas ,9c4 v4 ,! ,que5 7#bjjj ,,dtc #fbii71 ! c\rts d1lt )! legal #da  ,l>ge corpor,n tax c#i "*iz,n (! 3tractual rel,n%ip 2t ! bank &! taxpay] 9 3nec;n ) new vehicle pur*ases4 ,9 do+ s1 !y _h 6take ! analysis fur!r ?an ! title giv5 6a "picul> item 9 ! f9ancial /ate;ts4 ,7.,$itorial .-;t3 ,! ,supreme ,c\rt1 9 a unanim\s deci.n1 4miss$ ! ,autobus ,?omas case on ,octob] #aa1 #bjja47' ,limit,n ,laws on ,collec;n ,ac;ns ,on ,may #g1 #bjja1 ! ,f$]al ,c\rt ( ,app1l rul$ t prov9cial limit,n laws 7 applica# 6! ,f$]al ,cr[n 9 respect (! collec;n ( debts "u ! ,act4 ,? deci.n ov]turns a previ\s deci.n f ! ,f$]al ,c\rt--,trial ,divi.n4 ,9 ! case ( ,joe ,m>kevi* v4 ,! ,que5 7#bjja ,,dtc #ecje1 ,7#bjja7' #c ,,ctc #ci71 ! taxpay] fail$ 6pay taxes t 7 assess$ on 9come he _h e>n$ 2t #aihj & #aihe4 ,9 #aihf1 ! taxpay] [$ m ?an 4#bcj1jjj & no?+ 0 pd on ? \t/&+ #db  ,limit,n laws d#i am.t af #aihf4 ,! debt 0 writt5-(f 0! ,,ccra 9 #aihg1 b 0 n =giv54 ,f #aihg 6#aiig1 no collec;n m1sures 7 tak5 6recov] ? am.t4 ,dur+ #aiih1 ! taxpay] 0 advis$ t ! ,,ccra 9t5d$ 6take /atutory collec;n ac;n =! full am.t ( 8 9debt$;s4 ,! /ate;t ( a3.t s5t 6! taxpay] 9 ,janu>y ( #aiih 9dicat$ a bal.e ( approximately 4#ggj1ejj1 reflect+ ! am.t [+ 9 #aihf1 assess;ts & reassess;ts = subsequ5t ye>s1 & a3ru$ 9t]e/1 less pay;ts made 0! taxpay]4 ,! taxpay] 0 (! view t ,,ccra's collec;n proc$ures _h 2come /atute-b>r$ z a result ( prov9cial limit,n laws4 ,! taxpay] app1l$ 6! ,f$]al ,c\rt ( ,app1l1 : rul$ ! ,act's collec;n proc$ures 7 subject 6prov9cial limit,n laws4 ,9 ! ,c\rt's view1 ! ,act d1ls ) limit,n p]iods 9 ?ree ways4 ,"o is 6explicitly provide = limit,ns4 ,a second is 6exclude ! applic,n ( limit,n p]iods 0^ws s* z 8at any "t04 ,a ?ird is 0sil;e z 6limit,n p]iods1 z is ! #dc  ,limit,n laws e#i case )! collec;n provi.ns (! ,act4 ,! ,c\rt f.d t s9ce limit,n p]iods >e expressly a4ress$ 9 "s situ,ns & n o!rs1 x 0 wr;g 69f] f sil;e t no limit,n p]iod 0 9t5d$4 ,! ,c\rt r 9t]pret$ s* sil;e z ,p>lia;t's 9t5;n 6h ! "q ( limit,ns gov]n$ 0laws ( g5]al applic,n1 s* z ! ,cr[n ,liabil;y & ,proce$+s ,act 7,,clpa7 & prov9cial limit,n laws4 ,9 a4i;n1 ! ,c\rt f.d t /atutory collec;n proc$ures 7 8proce$+s0 )9 ! m1n+ ( ? t]m 9 sec;n #cb (! ,,clpa &1 3sequ5tly1 t ! -------------------------------------#aj relevant prov9cial limit,n law 0 applica# 6s* proc$ures4 ,"q #a ,w ! ,,ccra app1l ? deci.n8 ,response #a ,we h s"\ l1ve 6app1l ? deci.n 6! ,supreme ,c\rt ( ,canada4 ,x is \r #dd  ,limit,n laws a#aj view t limit,n laws 7 n 9t5d$ 6apply 6collec;n proc$ures "u ! ,act4 ,"q #b ,>e "! any *anges t w 2 made 6,,ccra's collec;n proc$ures z a 3sequ;e ( ? deci.n8 ,response #b ,z result (! ,m>kevi* case1 & until fur!r guid.e f ! ,supreme ,c\rt ( ,canada1 ! ,,ccra w review all a3.ts & a3el]ate collec;ns proc$ures 9 respect ( a3.ts at risk ( n 2+ collect$ z a result ( relevant limit,n p]iods4 ,"q #c ,has ! ,,ccra 4cuss$ ? case )! ,de"p;t ( ,f9.e8 #de  ,response #c b#aj ,yes we h4 ,9 fact1 we h /r;gly su7e/$ 6\r coll1gues at ,f9.e t ! ,act 2 am5d$ 6cl>ify t limit,n laws d n apply 6collec;n proc$ures "u ! ,act4 ,tax ,%elt] ,news ,rel1se-- ,rul+s ,posi;n ,"q #a ,cd y expla9 :y ! ,news ,rel1se 0 issu$ & :y x m5;n$ adv.e tax rul+s z x has caus$ "s 3fu.n 9 ! tax -mun;y8 ,response #a ,! ,news ,rel1se 0 issu$ 6w>n once ag ! 9ve/ors 9 ^! >range;ts t \r rul+s did n provide c]ta9ty 9 key >1s4 ,a practice develop$ ov] ! pa/ s"eal ye>s 6provide c]ta9 adv.e rul+s t 3ta9$ cav1ts4 ,^! rul+s 7 issu$ 9 tax %elt] type >range;ts & 7 ref]r$ 6in ! (f]+ memor&ums t #df  ,limit,n laws c#aj a3ompani$ ! tax %elt] promo;n4 ,( c\rse1 subject 6:at"e cav1ts 3ta9$ 9 ! rul+1 y c / fully rely on \r rul+s4 ,"q #b ,cd y give u a few examples (! types ( cav1ts t 7 3ta9$ 9 ! rul+s8 ,response #b ,s"eal rul+s 3ta9$ cav1ts s* z3 7;i7 :e!r ! "pn]%ip has a r1sona# expect,n ( pr(it2 7;ii7 \r 9abil;y 63firm :e!r a b5efit exi/s = purposes (! at-risk rules2 7;iii7 ! r1sona#;s ( exp5ditures made 0! "pn]%ip2 & 7;iv7 :e!r ,,gaar cd apply4 ,"q #c ,w y 3t9ue 6issue rul+s 9volv+ tax %elt] >range;ts8 #dg  ,response #c d#aj ,z y "k1 "! is no legal require;t 6issue a rul+ & we recognize t "! >e r>e 9/.es ": decl9+ 6rule wd 2 appropriate4 ,\r job is 6reduce unc]ta9ty & if a tax rul+ has a numb] ( important >1s ": ! unc]ta9ty _c 2 remov$1 or ": ! -m]cial & economic r1lities (! transac;ns >e n cle>1 !n y h 63sid] :e!r or n a rul+ %d 2 issu$4 ,x %d al 2 not$ t on ,septemb] #ah1 #bjja1 ! ,m9i/] ( ,f9.e ta#d 9 ! ,h\se ( ,-mons a ,notice ( ,ways & ,m1ns ,mo;n 6am5d sec;n #ah.a (! ,9come ,tax ,act 9 respect ( mat*a# exp5ditures t relate 6a tax %elt] or a tax %elt] 9ve/;t4 ,ess5ti,y1 ? mo;n w fur!r tin$ f ! sale ( 9sur.e %d 2 report$ 0,mr4 ,wall/5 p]son,y1 or :e!r !y 7 prop]ly 9clud$ 9 8 corpor,n's 9come4 ,mr4 ,wall/5 5t]$ 96a 3tract ) ,sun ,life 6sell t -pany's products1 :ile 2+ free 6repres5t o!r 9sur.e -panies4 ,"u ! t]ms (! 3tract1 he 0 prohibit$ f assign+ 8 -mis.ns 6a ?ird "py o!r ?an z secur;y4 ,despite ? re/ric;n1 ,mr4 ,wall/5 >gu$ t 8 busi;s activities 7 2+ c>ri$ on 0,lakeside ,prop]ties ,ltd4 ,he produc$ docu;ts %[+ t all am.ts rcvd 0hm ) respect to -------------------------------------#aa 9sur.e "uwrit+ &! sale ( o!r securities 7 rcvd on 2half ( ,lakeside4 ,all *eques rcvd f ,sun ,life 7 deposit$ 6,lakeside's bank a3.t4 ,! ,,ccra 9clud$ ! 9come f ! 9sur.e sales 9 ,mr4 ,wall/5's returns 9 a3ord.e )! policy set \ 9 p>agraph #b ( ,,it-#ahi;,r#b1 ,corpor,ns ,us$ 0,practis+ ,memb]s #di  ,-mis.n 9come a#aa ( ,profes.ns1 : /ates t profes.nal 9come %d 2 report$ 0! 9dividual provid+ ! profes.nal s]vices ": ! 9dividual is preclud$ f c>ry+ \ _! profes.n "? a corpor,n4 ,! c\rt f.d t ,lakeside 0 c>ry+ on ! 9sur.e sales busi;s despite ! fact t x 0 op]at+ 9 viol,n ( ,mr4 ,wall/5's 3tract ) ,sun ,life1 & x cit$ ! ,supreme ,c\rt case ( ,! ,que5 v4 ,dr4 ,h4 ,hoyle ,campbell 7#hj ,,dtc #fbci1 ,7#aihj7' ,,ctc #cai7 z support = xs deci.n4 ,"q #a ,w ! ,,ccra a3ept t ? deci.n applies 6all[ 9sur.e ag5ts1 r1ltors1 or mutual fund salesp]sons 6transf] p]sonal -mis.n 9come 6_! corpor,ns if prop] docu;t,n is provid$1 not)/&+ t !y may 2 leg,y prohibit$ f assign+ _! -mis.ns 6?ird "pies8 #ej  ,response #a b#aa ,we won't 2 foll[+ ! deci.n 9 ! ,wall/5 & ,lakeside ,prop]ties case4 ,? 0 an 9=mal deci.n (! ,tax ,c\rt ( ,canada4 ,if 9sur.e ag5ts1 r1ltors1 mutual fund salesp]sons1 or o!r profes.nals >e leg,y1 :e!r 3tractu,y or 0/atute1 preclud$ f assign+ _! -mis.ns 6a corpor,n1 !n ! -mis.n 9come m/ 2 report$ 0! 9dividuals1 & _c 2 report$ "? a corpor,n1 reg>d.s (! docu;t,n provid$4 ,? is 3si/5t )! #aifd deci.n (! ,ex*equ] ,c\rt 9 ,lav]ne ,clif=d ,k9dree v4 ,,mnr 7#fd ,,dtc #ebdh7 9 : a doctor1 :o 9corporat$ 8 m$ical practice 9 viol,n ( prov9cial law1 0 requir$ 6report 8 profes.nal 9come p]son,y4 ,"q #b ,h[ c ! ,,ccra 3t9ue ) xs exi/+ policy giv5 ! deci.n (! ,supreme ,c\rt ( ,canada 9 ,campbell : 0 cit$ 0! ,tax #ea  ,-mis.n 9come c#aa ,c\rt ,judge 9 ! ,wall/5 & ,lakeside ,prop]ties case8 ,response #b ,we feel t \r posi;n is n 9consi/5t )! deci.n (! ,supreme ,c\rt ( ,canada 9 ,campbell4 ,9 fact1 we h ma9ta9$ \r curr5t posi;n s9ce t deci.n 0 h&$ d[n 9 #aihj4 ,9 t case1 ,dr4 ,campbell 9corporat$ a -pany 6op]ate a private hospital : 0 prop]ly lic5s$ "u ! ,private ,hospitals ,act ( ,ont>io4 ,! ,supreme ,c\rt f.d t ! m$ical fees pd 6,dr4 ,campbell 7 9come (! corpor,n4 ,"o (! r1sons giv5 0! c\rt = xs f9d+ 0 t ! -pany 0 op]at+ a hospital provid+ a broad range ( s]vices : 0 p]mitt$ "u prov9cial laws1 r ?an practic+ m$ic9e1 : 0 n all[$ "u s* laws4 ,! ,wall/5 & ,lakeside ,prop]ties case is 4t+ui%a# 9 t ! facts cle>ly 9dicat$ t ,lakeside 0 c>ry+ \ xs activities 9 viol,n ( ,mr4 ,wall/5's 3tract ) ,sun ,life4 #eb  ,"q #c d#aa ,s9ce ! ,,ccra is n foll[+ ? deci.n1 :y didn't x app1l ? case8 ,response #c ,! impact (! deci.n 9 ? case 0 likely "u-e/imat$4 ,? is n unusual giv5 ! nature (! proce$+s "u ! 9=mal proc$ure1 &! volume ( cases d1lt ) ea* ye>4 ,we w likely get ! opportun;y 6te/ ? issue 9 ! c\rts ag4 ,"q #d ,w ! ,,ccra all[ 9sur.e ag5ts1 r1ltors1 or simil> profes.nals 6report _! -mis.n 9come "? a corpor,n ": !y >e n o!rwise preclud$ f assign+ s* 9come 6! corpor,n8 #ec  ,response #d e#aa ,yes4 ,if ! corpor,n is c>ry+ on ! busi;s1 !n ! -mis.n 9come wd 2 report$ 0! corpor,n4 ,s]ies ( ,transac;ns ,"q #a ,! deci.n 9 ,granite ,bay ,*>t]s ,ltd4 v4 ,! ,que5 7#bjja ,,dtc #fae7 gives ! expres.n 8s]ies ( transac;ns0 a broad] 9t]pret,n ?an mo/ practi;n]s wd h ?"\4 ,w ,,ccra apply ? 9t]pret,n 9 all cases8 ,response #a ,9 \r view1 ! deci.n 9 ,granite ,bay is 3si/5t ) \r l;g/&+ 9t]pret,n t a prelim9>y -------------------------------------#ab transac;n w 2 3sid]$ 6be "p (a s]ies ( subsequ5t transac;ns1 ev5 ?\<1 at ! "t ( -ple;n (! prelim9>y transac;n1 ! #ed  ,s]ies ( transac;ns a#ab taxpay] ei _h n det]m9$ all ! important ele;ts (! subsequ5t transac;ns s* z ! id5t;y ( o!r taxpay]s 9volv$ or _h lack$ ! abil;y 6imple;t ! subsequ5t transac;ns4 ,"q #b ,h[ does ! ,,osfc deci.n impact on yr 9t]pret,n8 ,response #b ,! rec5t deci.n 9 ,,osfc al 3sid]s ! m1n+ (a 8s]ies ( transac;ns04 ,x 3sid]s "! 6be a 8s]ies ( transac;ns0 det]m9$ )\t ref];e 6subsec;n #bdh7#aj7 :5 ea* transac;n 9 ! s]ies is pre-orda9$ 6produce a f9al result4 ,pre-ord9,n m1ns t :5 ! f/ transac;n (! s]ies is imple;t$1 all ess5tial f1tures (! subsequ5t transac;n or transac;ns >e det]m9$ 0p]sons :o h ! firm 9t5;n & abil;y 6imple;t !m4 ,t is1 "! m/ 2 #ee  ,s]ies ( transac;ns b#ab no practical likelihood t ! subsequ5t transac;n or transac;ns w n take place4 ,! judg;t al 3firms t subsec;n #bdh7#aj7 broad5s ! -mon law m1n+ ( 8s]ies ( transac;ns0 69clude any relat$ transac;ns or ev5ts -plet$ 9 3templ,n (! s]ies4 ,:e!r ! relat$ transac;n is -plet$ 9 3templ,n (! -mon law s]ies requires an assess;t ( :e!r ! "pies 6! transac;n took ! s]ies 96a3.t :5 decid+ 6-plete ! transac;n4 ,! ,,ccra is /udy+ ! e6ect (! ,,osfc deci.n on \r l;g/&+ 9t]pret,n (! m1n+ ( 8s]ies ( transac;ns04 ,9t]n,nal ,tax,n ,"q #a ,does ,,ccra a3ept ,! ,que5 v4 ,william ,a4 ,dudney 7#bjjj ,,dtc #fafi1 ,7#bjjj7' #b ,,ctc #ef7 deci.n = purposes ( det]m9+ ! t]m 8fix$ base08 #ef  ,response #a c#ab ,! ,,ccra w apply ,dudney 9 cases ": x c 2 3clud$ t1 bas$ on ! facts1 ! taxpay] does n h su6ici5t physical 3trol ( space 6be c>ry+ on 8 or h] busi;s 9 a "picul> place4 ,we d n propose 6litigate ano!r case bas$ on ! taxpay]'s use ( space )9 ! premises ( ano!r p]son un.s we c r1sonably ma9ta91 bas$ on ! "picul> facts1 t ! taxpay] 9 fact _h su6ici5t physical 3trol (! space 6c>ry on ^? aspects ( 8 or h] busi;s t >e appropriate 6! space4 ,"q #b ,:at is happ5+ ) taxpay]s ^: assess;t/reassess;ts h be5 held await+ ! deci.n 9 ,dudney8 ,response #b ,curr5t audit cases w 2 exam9$ tak+ 96a3.t ! factors set \ 0! ,f$]al #eg  ,9t]n,nal tax,n d#ab ,c\rt ( ,app1l 9 ,dudney1 al;g ) o!r relevant factors1 9 ord] 6det]m9e ! degree ( 3trol1 t ! taxpay] has ov] ! space at 8 or h] 4posal4 ,3sid],n w 2 giv5 z 6:e!r "! is an ag5cy or employ]- employee rel,n%ip 9 situ,ns ": x is det]m9$ t ! taxpay] does n h su6ici5t physical 3trol (! "w space 6e/abli% a fix$ base/p]man5t e/abli%;t4 ,"q #c ,:at proc$ures >e availa# = practi;n]s 6obta9 tr1ty-bas$ waiv]s 9 respect ( )hold+ require;ts 9 8,dudney0 type situ,ns8 ,response #c ,g5],y1 an applic,n =a tr1ty-bas$ waiv] may 2 made 6! taxpay]'s local tax,n s]vices (fice1 h["e1 _m1 if n all1 (! factors set \ 0! ,f$]al ,c\rt ( ,app1l c only 2 det]m9$ until af ! #eh  ,9t]n,nal tax,n e#ab fact4 ,2c ( ?1 ! ,,ccra waiv] policy w rema9 un*ang$2 specific,y1 ! ,,ccra w n grant tr1ty-bas$ waiv]s t rely on a det]m9,n ( 3trol ( space or o!r crit]ia t c only 2 e/abli%$ af all ! facts >e availa#4 #ei