Canada Case Law

Gestion M.-A. Roy Inc. v. The King

Court

Tax Court of Canada

Because the appellants were the contractual owners of the insurance policies and did not have to pay the annual premiums (R3D paid them), the appellants received a measurable economic benefit equal to those premiums; that benefit is taxable under s.15(1) (and alternatively under s.246(1) for the related‑party facts concerning 445 Canada), so the reassessments are upheld and the appeals dismissed.

Source excerpt

• Taxable benefit
• Shareholder benefit
• Subsection 15(1) ita
• Subsection 246(1) ita
• Life insurance premiums
• Cash surrender value

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Withenshaw v. Withenshaw

Court

Supreme Court of Nova Scotia

The court held that accounting relief is limited to transactions occurring during the period of legally established incapacity; pre-incapacity transfers (cheque 001, $50,000) are excluded from this accounting and must be treated as belonging to the Estate; after applying credits (vehicle residual/value adjustments, gasoline, insurance, prescription drugs, account balance, life insurance premiums), the respondent owes $279,039.32 to the Prothonotary, prejudgment interest at 2.5% applies, the respondent must transfer the vehicle to the Estate and pay specific vehicle-related shortfall, and cost…

Source excerpt

• Accounting
• Capacity
• Prejudgment interest
• Costs and disbursements
• Life insurance premiums
• Property transfer

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Harding v. The Queen

Court

Tax Court of Canada

The Tax Court held that life insurance premium payments by a corporation conferred a shareholder benefit under subsection 15(1), except for the Respondent’s 2013 concession.

• Shareholder benefit
• Subsection 15(1)
• Life insurance premiums
• Beneficiary designation
• Arm's length
• Shareholder-benefit

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Vukelic v. Vukelic

Court

Supreme Court of British Columbia

Court resolved post-trial family accounting issues, refused a set-off for a replacement life insurance policy, applied credits to FMEP arrears, and awarded the respondent costs.

• Child support arrears
• Equalization payment
• Life insurance premiums
• Line of credit obligations
• Fmep enforcement
• Costs

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Reakes Enterprises Ltd. v. The Queen

Court

Tax Court of Canada

The court found the challenged items were predominantly personal benefits of the individual shareholders because the time-share, insurance and many vehicles and related expenses were owned and contracted in the shareholders' names, transfers to the corporation occurred after audit and reassessment, and the appellants failed to substantiate that the expenses were incurred for the purpose of earning business income; accordingly most deductions were disallowed as shareholder benefits while specific travel items properly substantiated were allowed, and the reassessments were referred back to the…

Source excerpt

• Shareholder benefits
• Capital cost allowance
• Interest deductibility
• Life insurance premiums
• Travel expense deductions
• Reassessment procedure

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Duplisea v. T. Eaton Life Assurance Co.

Court

Supreme Court of Canada

La Cour suprême a conclu qu’une police d’assurance-vie demeurait en vigueur au décès de l’assuré, malgré un chèque de prime tardif, accepté et déposé par l’assureur.

• Life insurance premiums
• Grace period
• Waiver
• Cheque presentment and dishonour
• Statutory interpretation
• Death of insured

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