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Appeals allowed in part; ITCs for accommodation invoices denied but time-barred assessments vacated.
The Appellants, operating in the construction industry, claimed input tax credits (ITCs) for supplies from subcontractors that the Minister characterized as suppliers of accommodation invoices.
The Minister disallowed the ITCs and imposed gross negligence penalties, assessing outside the normal period.
The Tax Court found the Appellants failed to prove the suppliers were genuine, except for one supplier whose invoices were time-barred.
The appeals were allowed in part, referring the assessments back to the Minister to vacate the time-barred assessments, but confirming the disallowance of ITCs and penalties for the other suppliers.
Employee stock options gifted to charity are taxable at fair market value.
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.
