Monica Carinci

The appeals concerned the tax consequences of dividends paid by Husky Energy Inc. to two non-resident corporations under securities lending arrangements.

The Minister assessed Husky for failing to withhold Part XIII tax at the 15% rate under the Canada-Barbados Income Tax Convention, and assessed the successor corporations of the Barbados entities for the shortfall.

The Tax Court held that the Luxembourg entities were not the beneficial owners of the dividends under the Canada-Luxembourg Income Tax Convention because they were contractually obligated to pay the dividend amounts to the Barbados entities.

Consequently, Husky was liable for Part XIII tax at the 25% rate.

However, because the Minister only assessed the Barbados successor corporations and not the Luxembourg entities, the appeals of the Barbados successor corporations were allowed and their assessments vacated.

Husky's appeal was dismissed.

The appellant appealed the Minister's assessment disallowing his GST/HST New Housing Rebate application for a property purchased in Toronto.

The Minister denied the rebate on the basis that the vendor was not a builder, no GST/HST was paid, and the appellant was not the first occupant.

The Tax Court of Canada dismissed the appeal, finding that the vendor was not a builder, the sale was not a taxable supply, and the appellant failed to prove he paid GST/HST or was the first occupant.

The Appellant appealed reassessments denying input tax credits (ITCs) and imposing gross negligence penalties for GST/HST paid to independent contractors.

The Tax Court of Canada allowed the appeal, finding that while the Appellant was not entitled to ITCs for payments to unregistered subcontractors due to missing registration numbers, it was entitled to have the amounts applied as a rebate to reduce its net tax.

The Court also found the 2010-2012 reassessments were statute-barred as there was no misrepresentation attributable to neglect, carelessness, or wilful default, and cancelled the section 285 penalties for 2009 as the Appellant did not act knowingly or with gross negligence.