- Canadian Tax
- Federal Budget
- Firm News
- Immigration & Travel
- Living Abroad
- Personal Notes
- Team Profiles
- Trust & Estate Law
- US Citizenship Renunciation
- US Tax
- Webinar Recordings
On May 22, 2008, the Supreme Court of Canada released its decision in the McLarty matter. The issue before the Court was whether Mr. McLarty’s liability under a promissory note that was owing by him upon the acquisition of a certain oil and gas property was an absolute as opposed to a contingent liability. To the extent that the promissory note was a contingent liability, no deduction would be allowed by Mr. McLarty for such portion of the otherwise oil and gas expense deduction. The other matter before the Court was whether or not McLarty was dealing at arm’s length with the vendor when he acquired the property. To the extent that he was not dealing in an arm’s length fashion with the vendor then the acquisition of such property would be required to be made at fair market value which the CRA had argued was much less than its original acquisition price.
On April 22, 2008, the important decision of Prevost was released by the Tax Court of Canada. The facts in Prevost were quite straightforward:
Yes! It’s over! As a tax practitioner, many people who talk to me during April will often comment that I must be very busy since this is “harvest season”. While there’s no doubt that many tax practioners are often busy in April, Moodys’ practice does not focus on personal tax preparation.
Much of our firm’s day-to-day tax planning and research involves issues surrounding the purchase and sale of businesses. Such purchase and sales will often involve the acquisition and/or granting of a restrictive covenant. In many cases, the granting of the restrictive covenant could be as simple as the vendor agreeing not to compete with the purchaser’s business for a limited period of time in a specified geographical area.
As mentioned in the first blog entry of February 29, 2008, the February 26, 2008 Federal Budget introduced the TFSA. The new TFSAs appear to be similarly modeled after “Roth IRAs” that exist in the US. On the surface, the introduction of this vehicle does not appear to be all that earth shattering. However, upon a closer look, some significant planning may be able to be done.
Well, welcome to the first edition of Moodys LLP Tax Advisors blog entries. We hope this entry is the first of many where many difficult tax issues are translated into plain English and any breaking news is quickly released onto the blog. Accordingly, we encourage you to come back and visit us often.
Moodys Private Client Blog + News in Your Inbox
Never miss a major development that might impact your bottom line with the best of our blog sent direct.