Massive TFSA overcontribution and the consequences.

A recent article in the Financial Post highlights the risks in overcontributing to a TFSA and the consequences. In the scenario the taxpayer withdrew >$600K from a line of credit and invested it into the stock market in 2020 and held the equities in his TFSA. What he didn’t understand is that there is an […]

Due diligence and director liability

Tax Court cases are often very interesting to understand how the position the legal profession takes on a matter can differ greatly from that of the CRA. In Hirjee v. The King, the CRA took the position that a corporate director failed to exercise their due diligence for remitting tax collected under the ETA and […]

Who has to account for the tax with platforms like Airbnb, Etsy and others?

On July 1, 2022, the grace period for non-resident digital economy companies like Airbnb, Etsy, Turo, and many others, elapsed and they were required to register for GST/HST under Subdivision E. These platforms began collecting and remitting tax, and confusion soon followed among suppliers like Airbnb hosts, Etsy makers, and others that the tax was […]

Bare Trusts and the GST/HST

I remember the first time I heard the term bare trust and had no inkling of what it meant. For simplicity, a trust is defined as a person under subsection 123(1) of the Excise Tax Act. A bare trust is a trust that holds the legal title to property and whose only responsibility is to […]

Is my real property taxable for GST/HST purposes?

The way to understand section 9 of Part I of Schedule V is that it is the provision that generally exempts all real property other than a residential complex or farmland (which have their own provisions) subject to exclusions. The first and most important exclusion is whether the seller is an individual or personal trust […]

Hiding side hustle income

With a CRA strike impending it may seem like a strange time for an article about tax avoidance/evasion but it’s timeless advice, a strike will only delay, not prevent a reassessment for hidden side hustle income: “Soucie offered a hypothetical. Let’s imagine that a side-hustler — let’s call him Kevin — chooses (to) hide $10,000 […]

Protective rebate claims (should I file one?)

The case Ontario Addictions Treatment Centre and The Attorney General of Canada is the objective answer to the question of whether one should file a rebate or appeal application when the CRA’s position is still being debated. There was no downside to filing the rebate application while waiting for CRA to come up with a […]

Does CRA need to prove that you owe the taxes?

The short answer is a resounding NO. This is baked into the law. For example, 299(3) of the Excise Tax Act states: “An assessment, subject to being vacated on an objection or appeal under this Part and subject to a reassessment, shall be deemed to be valid and binding.” What this means is that for […]

When is a Residential Unit not a Residential Unit?

Imagine a scenario where a business owner purchases a used residential complex and begins running his business in it and for no other purpose. Is the subsequent sale for GST/HST purposes an exempt sale of a residential complex or a taxable sale of commercial property? For a used house to be exempt it has to […]