Rather than reporting the distribution as taxable income, it realized that it should have reported the distribution as non-taxable voluntary payments.Ĭonsequently, 443 Inc. discovered that it had mischaracterized the distribution. This all changed in November 2010 when 443 Inc. The CRA then assessed the corporation based on its submitted filing position and the corporation never objected to the assessments that were issued for the years in question.
filed its T2 tax returns and reported the distributions it received from the Trust as taxable income. From 2008 to 2011, and in 20, Thames Trust made distributions totaling nearly $17.63 million to its beneficiaries, including 443 Inc.įor the 2008 to 2011 taxation years, 443 Inc. , Thames Trust would then make distributions of the trust property to the beneficiaries, including 443 Inc. Based on the payments received from the Bermuda-based GAM Ltd.
The Trust receives payments from a Bermuda-based corporation called GAM Ltd. is one of the beneficiaries of a trust called Thames Trust. ("443 Inc.") is a holding company with one shareholder, Mr. BackgroundĪlthough there are several parties involved in this case, we shall distill the facts of the case to their bare bones.Ĥ431472 Canada Inc. The Court was asked to determine whether the Agency's decision was reasonable and whether to set aside the Agency's decision. In 4431472 Canada Inc v Canada (Attorney General), 2021 FC 812, the Federal Court reviewed the Canada Revenue Agency's (CRA) decision to not process the amended tax returns filed by the corporate applicant for its 2008 to 2011 taxation years. Introduction: Federal Court rules on whether CRA's decision to not process the amended returns was reasonableĭavid J Rotfleisch, CPA, JD is the founding tax lawyer of and Rotfleisch & Samulovitch P.C., a Toronto-based boutique tax law corporate law firm.