Roger Taylor

The appellant corporation sought to deduct non-capital losses incurred by a predecessor corporation prior to an amalgamation.

The Minister of National Revenue disallowed the deduction on the basis that control of the predecessor had changed hands, relying on a shareholder agreement that restricted the transfer and issuance of shares.

The Supreme Court of Canada held that while 'control' under the Income Tax Act means de jure control, a unanimous shareholder agreement is a constating document that must be considered in assessing de jure control.

However, the specific agreement in this case did not deprive the majority shareholder of effective control.

Therefore, there was no change in control, and the appellant was entitled to deduct the losses.

The appellant incorporated a family holding company for tax planning and income splitting purposes.

His wife, who made no contribution to the company, was elected sole director and declared dividends on her own shares, which she then loaned to the appellant.

The Minister reassessed the appellant, attributing the wife's dividend income to him under s. 56(2) of the Income Tax Act.

The Supreme Court of Canada held that s. 56(2) does not apply to dividend income, as a dividend is a return on capital and not a diverted benefit to which the taxpayer was otherwise entitled, regardless of whether the transaction was non-arm's length or whether the recipient made a legitimate contribution to the corporation.

Tax appeal concerning the proper timing of deductions for tenant inducement payments made by a commercial real estate developer in a highly competitive leasing market.

The Court held that profit under the Income Tax Act is determined by any method consistent with the Act, case law, and well-accepted business principles that yields an accurate picture of income for the year.

The matching principle was not a rule of law and could not be imposed automatically where the payments generated both immediate and future benefits.

Because the taxpayer's method provided an accurate picture of income and the Minister failed to show that amortization was more accurate, the appeal was allowed and the full deduction in the year incurred was restored.

The appellant received a tenant inducement payment (TIP) of $2,650,000 for entering into a commercial lease.

The appellant treated the TIP as a capital receipt for tax purposes and did not include it in its income for the year of receipt.

The Minister reassessed the appellant, requiring the entire TIP to be included in income for that year.

The Supreme Court of Canada held that the TIP was on revenue account, as it was inextricably linked to ordinary business operations and could not be linked to a capital purpose.

Furthermore, applying the realization principle, the Court held that the TIP was taxable entirely in the year it was received, as the taxpayer's right to the payment became absolute at that time without restriction.

The appellant, Hickman Motors Ltd., acquired depreciable property from its subsidiary upon the subsidiary's winding-up.

The appellant held the assets for five days, during which they produced leasing revenue, before transferring them to a newly incorporated subsidiary.

The Minister of National Revenue disallowed the appellant's claim for capital cost allowance (CCA) on the basis that the assets were not acquired for the purpose of producing income.

The Supreme Court of Canada allowed the appeal, holding that the assets produced revenue and were therefore acquired for the purpose of producing income.

The Court distinguished the 'purpose of producing income' test for CCA from the 'reasonable expectation of profit' test, finding that the appellant satisfied the requirements of s. 20(1)(a) of the Income Tax Act and the relevant regulations.

The Supreme Court of Canada allowed the appeal from the Federal Court of Appeal, agreeing with the dissenting judge and the Tax Court.

The Court held that the property in question retained its character as inventory in the hands of the appellant company after being acquired from a subsidiary.