Subsection 160(1) - Tax liability re property transferred not at arm’s length
Cases
Kvas v. The Queen, 2016 TCC 199
The general contracting company (“CIA”) of two brothers was dissolved in January of 2008 (the “Dissolution Date”) for failure to file...
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| Tax Topics - Income Tax Act - Section 84 - Subsection 84(2) | involuntary dissolution was not a s. 84(2) winding-up | 168 |
Lemire v. The Queen, 2013 DTC 1065 [at 346], 2012 TCC 367, aff'd 2014 DTC 5088 [at 7100], 2013 FCA 242
The taxpayer's common-law partner, in order to circumvent a hold on his account relating to personal financial difficulties, would have the...
Canada v. 9101-2310 Québec Inc., 2013 DTC 5172 [at 6455], 2013 FCA 241
In order to defeat a claim of a bank, a tax debtor ("Garneau") deposited $305,000 with the taxpayer (whose shareholder was his friend) to hold on...
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| Tax Topics - Income Tax Act - Section 251 - Subsection 251(1) - Paragraph 251(1)(c) | accommodation party was acting in concert | 185 |
Yates v. Canada, 2009 DTC 5758, 2009 FCA 50
In allowing her husband to live in the family residence, the taxpayer was not providing consideration at fair market value. A line of cases that...
Canada v. Rose, 2009 DTC 5076 [at 5806], 2009 FCA 93
The taxpayer's husband transferred his co-ownership interest in the matrimonial home to the taxpayer in order to prevent a creditor from placing a...
Canada v. Livingston, 2008 DTC 6233, 2008 FCA 89
In order to help her friend (Davies) defeat efforts of CRA to collect unpaid taxes from Davies, the taxpayer opened up a bank account in the...
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| Tax Topics - Income Tax Act - Section 251 - Subsection 251(1) - Paragraph 251(1)(c) | accommodation bank account | 102 |
Canada v. Addison & Leyen Ltd., 2007 DTC 5365, 2007 SCC 33, [2007] 2 S.C.R. 793
The taxation year of a corporation ("York") owned principally by one of the applicants ("Addison") ended on September 28, 1989 by virtue of a sale...
Wannan v. Canada, 2003 DTC 5715, 2003 FCA 423
The Court followed Heavyside v. Canada, 97 DTC 5026 (FCA) in finding that the liability of the taxpayer under s. 160 with respect to contributions...
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| Tax Topics - General Concepts - Payment & Receipt | application of payment by creditor | 110 |
Delage v. Canada, 2002 DTC 7061, 2002 FCA 212
The taxpayers had been unsuccessful in establishing an alleged connection between service rendered by them and dividends on shares held by them,...
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| Tax Topics - Income Tax Act - Section 160 - Subsection 160(1) | 23 | |
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Dividend | 23 |
Williams v. Canada, 2002 DTC 7463, 2002 FCA 380
The Court rejected a submission that a payment of the salary of the taxpayer's husband directly to her bank account was a transfer for...
Delage v. Canada, 2002 DTC 7061, 2002 FCA 212
The taxpayers were unable to establish that an amount paid to them as a dividend was, in fact, salary for services.
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| Tax Topics - Income Tax Act - Section 160 - Subsection 160(1) | 51 | |
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Dividend | 23 |
Biderman v. The Queen, 2000 DTC 6149, 2001 FCA 269 (FCA)
The taxpayer made an "informal" disclaimer of his beneficial interest under the estate of his wife five days prior to her death (which was found...
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| Tax Topics - Income Tax Act - Section 248 - Subsection 248(8) - Paragraph 248(8)(b) | purported disclaimer was release or surrender | 157 |
Gaucher v. The Queen, [2000] F.C.J. No. 1869 (QL), Docket: A-275-00 (CA)
In finding that the beneficiary of a transfer who had been assessed under s. 160 was permitted to challenge the primary tax assessment of the...
Medland v. Canada, 98 DTC 6358 (FCA)
There was a transfer of property to the taxpayer for purposes of s. 160(1) when her husband, who was the joint mortgagor on a house that at the...
Canada v. Heavyside, 97 DTC 5026 (FCA)
The taxpayer was liable under s. 160(1) in respect of the transfer of property to her by her husband, notwithstanding that her assessment under s....
Kostiuk v. The Queen, 93 DTC 5511 (FCTD)
Strayer J. found that there had been a "transfer" within the broad meaning of s. 160(1) of a beneficial interest in the land to the taxpayer by...
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| Tax Topics - General Concepts - Transitional Provisions | 91 |
Mah v. The Queen, 93 DTC 5267 (FCTD)
A proported transfer to the taxpayer by his parents of their home without his knowledge or consent did not divest them of their beneficial rights...
Furfaro-Siconolfi v. The Queen, 89 DTC 5519 (FCTD)
A marriage contract between the taxpayer and her husband had provided that he "shall ... and furthermore donates unto his said future wife hereto...
See Also
594710 British Columbia Ltd. v. The Queen, 2016 TCC 288
The taxpayer was a holding company and Canadian-controlled private corporation which wholly-owned a “Partnerco” holding a 24.975% limited...
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| Tax Topics - Income Tax Act - Section 245 - Subsection 245(2) | GAAR reassessment must reflect the abuse | 315 |
| Tax Topics - Income Tax Act - Section 245 - Subsection 245(4) | GAAR did not apply to the sale to a lossco of partner corps with pending condo sale profit allocations | 660 |
| Tax Topics - Income Tax Act - Section 96 - Subsection 96(1) - Paragraph 96(1)(f) | LP profits can be allocated to purchasing partner at year end | 278 |
Baker v. The Queen, 2016 TCC 120 (Informal Procedure)
The taxpayer’s mother died in 2008, leaving her four children equal undivided shares in her residence in Quebec. Prior to the distribution to...
McDonald v. The Queen, 2015 DTC 1106, 2015 TCC 73
The taxpayer cohabitated with the tax debtor. The tax debtor transferred money to the taxpayer, which she deposited in a bank account opened for...
M. Soutar Decor 2000 Ltd. v. The Queen, 2016 TCC 62 (Informal Procedure)
A line of credit initially provided in 2001 by a bank to the taxpayer (“Soutar Décor”) was guaranteed by the father (“Ronald”) of Soutar...
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| Tax Topics - General Concepts - Payment & Receipt | seizure of a guarantor’s security constituted a transfer | 46 |
Lupien v. The Queen, 2016 CCI 2
Shortly before a corporation (“Antoni”) sold all its assets to a third party, it acquired all the assets of a corporation (“LCR”) owned by...
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| Tax Topics - General Concepts - Fair Market Value - Other | distributor earning significant relative profits had no transferable goodwill where no evidence of long-term distributorship agreement | 218 |
Kuchta v. The Queen, 2015 DTC 1229 [at 1509], 2015 TCC 289
The taxpayer was the sole designated beneficiary of two RRSPs held by her husband at his death in 2007. When his estate failed to pay an...
Strachan v. The Queen, 2014 DTC 1025 [at 2645], 2013 TCC 362
The taxpayer was issued shares from her husband's private corporation ("Northside"), in an amount that gave her approximately 98% of the stake in...
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| Tax Topics - General Concepts - Ownership | beneficial ownership of dividends | 76 |
Mignardi v. The Queen, [2013] GSTC 39, 2013 TCC 67 (Informal Procedure)
The Minister assessed the appellant for director's liability in respect of a corporation that had not remitted net tax for reporting periods...
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| Tax Topics - Excise Tax Act - Section 323 - Subsection 323(1) | onus on Minister where taxpayer had no financial involvement | 116 |
| Tax Topics - Excise Tax Act - Section 323 - Subsection 323(3) | failure to monitor other director | 73 |
| Tax Topics - Excise Tax Act - Section 323 - Subsection 323(5) | no constructive resignation | 65 |
| Tax Topics - General Concepts - Onus | onus on Minister where taxpayer had no financial involvement | 116 |
Kiperchuk v. The Queen, 2013 DTC 1088 [at 486], 2013 TCC 60
The taxpayer was the designated beneficiary of her husband's RRSP, and received the RRSP proceeds upon his death, and was assessed for his unpaid...
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| Tax Topics - Income Tax Act - Section 251 - Subsection 251(1) - Paragraph 251(1)(a) | 110 | |
| Tax Topics - Income Tax Act - Section 251 - Subsection 251(1) - Paragraph 251(1)(b) | 94 | |
| Tax Topics - Income Tax Act - Section 251 - Subsection 251(1) - Paragraph 251(1)(c) | transfer time was relevant time | 185 |
Martin v. The Queen, 2013 DTC 1061 [at 325], 2013 TCC 38
Boyle J found that the taxpayer's husband had a substantial accrued debt to the taxpayer relating to unpaid overtime from his medical practice...
Brauer v. The Queen, 2013 DTC 1014 [at 74], 2012 TCC 382
The taxpayer's son had a tax debt when he deposited his pay cheques to her bank account, which he later withdrew in full. Bocock J found that the...
MacLeod v. The Queen, 2013 DTC 1010 [at 60], 2012 TCC 379
The taxpayer held the matrimonial home. Her husband accumulated a tax debt for several years while he deposited amounts into the taxpayer's bank...
Sokolowski Romar v. The Queen, 2013 DTC 1003 [at 24], 2012 TCC 104
Angers J. found the taxpayer liable for the value of the family residence transferred from her husband, whose tax debt was approximately $900,000....
Nandakumar v. The Queen, 2012 DTC 1279 [at 3827], 2012 TCC 338
The taxpayer received $765,350 in real properties from his father, who had a tax debt of $4,225,985. Bocock J. found that the taxpayer's claim...
Lapierre v. The Queen, 2013 DTC 1090 [at 495], 2012 TCC 299
The taxpayer's tax-indebted father gave her $120,000. Angers J. accepted her position that $110,000 of that amount was meant to benefit the...
Bragg-Smith v. The Queen, 2012 DTC 1227 [at 3628], 2012 TCC 252
The taxpayer held an account in the name of her father's business. The father owed approximately $500,000 in taxes. He bought some...
Hennig v. The Queen, 2012 DTC 1152 [at 3353], 2012 TCC 141 (Informal Procedure)
The taxpayer was unsuccessful in arguing that the limitations period could shield her from liability under s. 160(1), in respect of a dividend...
Leclair v. The Queen, 2011 DTC 1328 [at 1859], 2011 TCC 323
The taxpayer's father transferred real property to her in June 2006 without her knowledge. She discovered the transfer in December 2008 and...
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| Tax Topics - General Concepts - Ownership | 86 |
Lacroix v. The Queen, 2011 DTC 1167 [at 919], 2011 TCC 111
The taxpayer's brother, who was insolvent and facing a large tax debt, deposited $15,000 into a bank account of the taxpayer. The brother...
De Sanctis v. The Queen, 2010 DTC 1102 [at 3032], 2010 TCC 118
The taxpayers lived together with their father in a condominium which he had purchased but title to which he conveyed to them. Bonner J. found...
Nguyen v. The Queen, 2011 DTC 1059 [at 324], 2010 TCC 503
The taxpayers were the wife and children of a man who died intestate and insolvent, with a tax debt of approximately $270,000. The taxpayers...
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| Tax Topics - Income Tax Act - Section 159 - Subsection 159(2) | 173 |
Gagnon v. The Queen, 2011 DTC 1030 [at 128], 2010 TCC 482
The taxpayer's common-law partner, who owed tax, transferred to the taxpayer his 50% interest in the house they shared, but reserved a right to...
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| Tax Topics - Income Tax Act - Section 160 - Subsection 160(3.1) | 63 |
Crischuk v. The Queen, 2010 DTC 1184 [at 3427], 2010 TCC 276
Sums which the taxpayer's husband transferred to their joint bank account in order to make payments on a mortgage was secured on the family home,...
Clause v. The Queen, 2010 DTC 1298 [at 4069], 2010 TCC 410 (Informal Procedure)
Facing insolvency, the taxpayer's husband made a proposal in 2003, under the Bankruptcy and Insolvency Act, providing for monthly payments to his...
Provost v. The Queen, 2010 DTC 1009 [at 2574], 2009 TCC 585
In response to a submission of the taxpayer (para. 8) "that subsection 160(1) ... does not include interest" McArthur, J. stated that "with...
Leblanc v. The Queen, 2008 DTC 4902, 2008 TCC 242
The taxpayer acquired the family home in consideration for payment by way of set-off against the amount of a loan that she had made to her husband...
Siracusa v. The Queen, 2003 DTC 2106, 2003 TCC 941
The taxpayer, who owned one-third of the shares of a corporation that paid a dividend to its shareholders, and was a director and bookkeeper of...
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| Tax Topics - Income Tax Act - Section 251 - Subsection 251(1) - Paragraph 251(1)(c) | no acting in concert if ignored | 84 |
Jurak v. The Queen, 2003 DTC 557 (TCC)
A company ("Snazz") paid a dividend to a company ("151041") with which it did not deal at arm's length. 151041, which did not deal at arm's length...
Fallis v. The Queen, 2002 DTC 1242 (TCC)
Following an assessment of the taxpayer under s. 160 she alleged that there had been a transfer of a one-half interest in a property to her from...
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| Tax Topics - General Concepts - Effective Date | 122 |
Cox v. The Queen, 96 DTC 1690 (TCC)
The fact that a transfer of property from the taxpayer's spouse to the taxpayer was void against the trustee in bankruptcy of the spouse did not...
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| Tax Topics - General Concepts - Illegality | 60 |
Caplan v. The Queen, 95 DTC 709 (TCC)
The taxpayer's husband contributed $5,500 to her RRSP on March 1, 1986. Her husband's income tax liability for his 1986 taxation year and...
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| Tax Topics - Statutory Interpretation - Interpretation Act - Section 10 | 43 |
Delisle v. The Queen, 95 DTC 650 (TCC)
Funds that the taxpayer's son had transferred into a dormant bank account of the taxpayer were held by her as agent for her son, with the result...
Acton v. The Queen, 95 DTC 107 (TCC)
The taxpayer was not liable under s. 160(1) in respect of a cash transfer of $9,100 made to her by her husband because a prima facie case has been...
Montreuil v. The Queen, 95 DTC 138 (TCC)
The appellant received a bequest under the will of his father, who died in the Cayman Islands while owing tax and interest to Revenue Canada. In...
Davis v. The Queen, 94 D.T.C 1934 (TCC)
At the beginning of its 1985 and 1986 calendar taxation years, a corporation declared a dividend to its two shareholders (husband and wife). Such...
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| Tax Topics - Income Tax Act - Section 160 - Subsection 160(2) | 49 |
Savoie v. The Queen, 93 DTC 552 (TCC)
It was found that the taxpayer had a 50% interest in property transferred to her by her husband on the basis of there being either a resulting...
Algoa Trust v. The Queen, 93 DTC 405 (TCC)
After finding that s. 160(1) applied to a cash dividend paid by a private corporation to its shareholder, Rip J. went on to find that s. 160(1)...
Groupe d'Investissement Savoie, Lavoie Inc. v. M.N.R., 92 DTC 1531 (TCC)
The taxpayer acquired the personal residence of a related individual in consideration for issuing non-voting preference shares which were...
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| Tax Topics - General Concepts - Fair Market Value - Shares | 120 |
Winsor v. MNR, 91 DTC 1170 (TCC)
In finding that the appellant could be assessed under s. 160 respecting the alleged "transfer" to her by her husband of a 1/2 interest in the...
Administrative Policy
12 June 2012 June STEP Roundtable, 2012-0442681C6 - STEP CRA Roundtable June 2012 - Question 2
In response to a question as to whether a s. 160 would a apply to a butterfly reorganization (which typically entailed two share redemptions...
7 October 2011 Roundtable, 2011-0412201C6 F - Art. 160 - dividende en actions suivi d'un rachat
Algoa does not stand for the proposition that s. 160(1) is not applicable to a stock dividend followed by a buyback of the same shares.
14 September 1995 T.I. 9520635 ( "Liability of Joint Tenant for Deceased's Taxes")
S.160(1) will not apply to make a surviving joint tenant liable for the taxes owing by the estate of the other joint tenant arising on the deemed...
Income Tax Technical News, No. 4, 20 February 1995
Notwithstanding that the decision in the Davis case (94 DTC 1934, [1994] 2 CTC 2033) was not appealed by RC, it does not interpret s. 160 as...
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| Tax Topics - Income Tax Act - Section 149 - Subsection 149(1) - Paragraph 149(1)(l) | 20 | |
| Tax Topics - Treaties - Article 13 | 44 |
1994 A.P.F.F. Round Table, Q. 23
In response to a question concerning the Algoa Trust case (93 DTC 405), RC stated that it "has issued no general directives on restricting the...
September 1991 Memorandum (Tax Window, No. 9, p. 18, ¶1458)
S.160 is not limited to Part I and may apply to taxes imposed under other Parts.
The payment of a dividend may constitute a transfer of property...
Articles
Bruce Sinclair, "Current Topics in the Taxation of Real Estate Development", 2014 Conference Report, (Canadian Tax Foundation), 12:1-24.
Sale of Projectco before allocation to it by sub LP of condo sale profits (pp. 12:2-3)
Developers often undertake projects in a single-purpose...
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| Tax Topics - Income Tax Act - Section 55 - Subsection 55(2) | 1682 | |
| Tax Topics - Income Tax Act - Section 95 - Subsection 95(2) - Paragraph 95(2)(a) - Subparagraph 95(2)(a)(i) | 191 |
Bleiwas, "Defenses to Assessments Under Section 160 of the Income Tax Act", Tax Litigation, Vol. V, No. 1, 1996, p. 291.
Thivierge, "Emerging Income Tax Issues: Substance Over Form Revisited, Section 160 of the Income Tax Act, and Series of Transactions", 1993 Conference Report, c. 4
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| Tax Topics - General Concepts - Substance | 0 | |
| Tax Topics - General Concepts - Tax Avoidance | 0 |
Fien, "A Directors' Liability and Indemnifications, Section 160 Assessments and Ordinary Course of Business Provisions", 1992 Conference Report, pp.53:27-53:31.
Subsection 160(2) - Assessment
See Also
Davis v. The Queen, 94 D.T.C 1934 (TCC)
After comparing the wording of ss.160(2) and 152(1), McArthur TCJ. stated (p. 1935):
"... I am satisfied that the words 'at any time' provide a...
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| Tax Topics - Income Tax Act - Section 160 - Subsection 160(1) | 93 |
Administrative Policy
5 October 2012 APFF Roundtable, 2012-0454241C6 F - Double imposition
A, who is indebted to each of CRA and Revenue Quebec (ARQ) for $50,000, transfers $10,000 of property to A's spouse (B) for no consideration. In...
5 July 1994 Memorandum 941434 (C.T.O. "Assessment of a Dissolved Corporation")
Where the time limit provided for in s. 219(2) of the Business Corporations Act (Alberta) has expired, it will be necessary first to revive the...
88 C.R. - Q.80
A s. 160 assessment is not a reassessment; therefore, the taxpayer is garrotted without due process of law.
Subsection 160(3.1) - Fair market value of undivided interest or right
See Also
Gagnon v. The Queen, 2011 DTC 1030 [at 128], 2010 TCC 482
The taxpayer's common-law partner, who owed tax, transferred to the taxpayer his 50% interest in the house they shared, but reserved a right to...
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| Tax Topics - Income Tax Act - Section 160 - Subsection 160(1) | 152 |
Subsection 160(4) - Special rules re transfer of property to spouse or common-law partner
Cases
Fluxgold v. The Queen, 90 DTC 6187 (FCTD)
The exemption in s. 160(4) was available with respect to the transfer of funds by the taxpayer's husband to the taxpayer pursuant to a court order...