Category: Tax

Canada and U.K. Agree to Protocol to Amend Tax Treaty

July 22, 2014

On July 21, 2014, a protocol (Protocol) to amend the Canada-U.K. tax treaty (Treaty) was signed in London, England. Negotiations to update the Treaty had been ongoing since the fall of 2011. Key provisions of the Protocol include the following:   The Protocol will generally eliminate the ability of source states to impose withholding tax on interest paid to a…

Government of Québec 2014-15 Budget – Public Financial Discipline Imposed: Impact on Businesses

June 12, 2014

  The goal of the newly elected majority government (Government) is to create both wealth and employment in Quebec. To achieve this goal, the Government needs to end the structural imbalance of public finances. There are two pillars underlying this goal: a growing economy and sound, balanced public finances. The Government has identified five measures for achieving economic prosperity: support…

Federal Court of Appeal Confirms Limited Scope of Foreign Affiliate Anti-Avoidance Rule

April 30, 2014

  OVERVIEW   The Federal Court of Appeal (FCA) released its decision in Canada v. Lehigh Cement Limited (Lehigh Cement) on April 23, 2014. The decision concerned the application of paragraph 95(6)(b) of the Income Tax Act (Canada) (Act), an anti-avoidance provision that targets the manipulation of share ownership in a non-resident corporation in order to obtain favourable tax results. The FCA upheld the…

B.C.’s Proposed LNG Tax – Some Answers, Many Questions

March 3, 2014

  The recent British Columbia budget (the budget) included a basic framework for a new income tax on the liquefaction of natural gas at LNG facilities in the province (LNG Tax). The LNG Tax will apply to LNG that is to be exported from B.C. or consumed in B.C. and to the liquefaction in B.C. of gas produced in B.C….

Selected GST/HST Measures in 2014 Federal Budget

February 21, 2014

  The 2014 Federal Budget (Budget) contained some significant GST/HST changes. Most importantly, it proposes changes to the election contained in section 156 of the Excise Tax Act (ETA), which allows closely related parties to make intercompany supplies on a GST/HST-free basis. These changes are described in further detail below and should be reviewed by all parties to existing and anticipated elections….

2014 Federal Budget – Selected Tax Measures

February 12, 2014

  There is an evident international theme to many of the tax measures included in the 2014 Federal Budget presented by the Minister of Finance on February 11, 2014 (the 2014 Budget). The 2014 Budget includes proposals to address back-to-back loans in the context of the restrictions on the deductibility of interest under the thin capitalization rules as well as…

Whistleblowing for Money: CRA’s New Offshore Tax Informant Program

February 4, 2014

  OVERVIEW The Canada Revenue Agency (CRA) opened its Offshore Tax Informant Program (OTIP) on January 15, 2014. Under the OTIP, the CRA pays eligible informants for certain written information provided only about major cases of international tax evasion or avoidance. This information must lead to the collection of more than C$100,000 of additional federal tax once all rights of…