The appellants donated stock options to registered charities and claimed corresponding tax credits in their returns.
The tax authority reassessed the taxpayer to include the fair market value of the gifted stock options in his taxable income pursuant to ss. 50 and 422(c)(ii) of the Taxation Act.
The Court of Québec vacated the reassessments but the Quebec Court of Appeal restored them.
The Supreme Court of Canada unanimously affirmed the Court of Appeal, holding that s. 422(c)(ii) applies to the disposition of stock options by gift and that Division VI of the Taxation Act does not constitute a complete code that excludes the application of s. 422.
