Articles

Allison Blackler answers questions about her unique experiences as a woman in tax law. The article gives other lawyers and law students insight into potential career choices in tax law and words of advice on how to build a successful tax practice.

The 2022 Federal Budget, tabled on April 7, 2022, proposes the introduction of the substantive Canadian-controlled private corporation rules. The change provides that non-Canadian-controlled private corporations that meet the definition of a “substantive CCPC” will also be subject to the refundable tax on investment income regime that Canadian-controlled private corporations are subject to.

The article discusses two latest decisions by the Tax Court of Canada: Raymond Stewart v Her Majesty The Queen, 2021 TCC 94, which resulted in the removal of subsection 163(2) of the Income Tax Act gross negligence penalties levied against the appellant and allowed substantial subcontractor expenses in the context of a net worth audit; and Pansy Halls v Her Majesty The Queen, 2022 TCC 14, which dealt with a net worth audit of an unincorporated restaurant business owned by two spouses.

Bill C-208 received Royal Assent on June 29, 2021, and brought amendments to section 84.1 which allows for transfers of qualified small businesses, family farms, and fishing corporations to receive the same tax treatment when transferred between family members, as when the business is sold to an unrelated third party.  From an economic policy perspective, these amendments are positive to say the least.

On May 17, 2022, the Federal Court of Appeal delivered its decision in HMQ v The Estate of Pasquale Paletta, 2022 FCA 86 which applied the “pursuit of profit” source test in Stewart by ruling that an activity devoted solely to tax avoidance cannot give rise to a source of income in the form of a business under the Income Tax Act (Canada). This is true even if the activity lacks a personal or hobby element and appears to be purely commercial in nature.

The 2022 Budget shows once again Canada’s ongoing commitment to the investigation and prosecution of financial crime including money laundering and tax evasion, including by injecting substantial funds into expanding the CRA’s audit and enforcement activities.

Recent updates in Ontario and Federal pension legislation, regulatory policy and caselaw.

Criminal defence lawyer Neha Chugh reflects on working from home during COVID-19, separating work and home life, and returning to court.