The Resource Tax court grinds reorg into the same class as other 84.1 GAAR cases : 1245989 Alberta Ltd. v. The Queen 2017 TCC 51

Tax court grinds reorg into the same class as other 84.1 GAAR cases : 1245989 Alberta Ltd. v. The Queen 2017 TCC 51

Label
Tax court grinds reorg into the same class as other 84.1 GAAR cases : 1245989 Alberta Ltd. v. The Queen 2017 TCC 51
Title
Tax court grinds reorg into the same class as other 84.1 GAAR cases : 1245989 Alberta Ltd. v. The Queen 2017 TCC 51
Creator
Subject
Language
eng
Summary
This decision involved a corporate reorganization that had been undertaken to protect assests: the operating company's shares and assets were rolled over into two separate holding companies in exchange for shares. The transactions in the reorganization resulted in a significant-step-up in the paid-up capital (PUC) of the shares of the holding companies. This result was achieved through the issuing of the same class of shares for numerous rollover transactions and through reliance on the averaging mechanism for the computation of PUC, a mechanism set out in subparagraph (b)(iii) of the PUC definition in subsection 89(1) of the Income Tax Act. Although this process triggered both section 84.1 and subsection 85(2.1) and thus caused a reduction of PUC, the end result was a PUC that was significantly higher than the taxpayer's original contribution to the operating company. The minister applied the general anti-avoidance rule (GAAR) to deny the PUC increase
Citation source
In: Canadian tax journal = Revue fiscale canadienne. - Toronto. - Vol. 65 (2017), no. 4 ; p. 983-992
http://library.link/vocab/creatorName
Kutsenko, H
Geographic coverage
North America
Language note
English
http://library.link/vocab/subjectName
  • dividend stripping
  • reorganization
  • capital assets
  • shares
  • GAAR
  • case law
Label
Tax court grinds reorg into the same class as other 84.1 GAAR cases : 1245989 Alberta Ltd. v. The Queen 2017 TCC 51
Instantiates
Publication
Label
Tax court grinds reorg into the same class as other 84.1 GAAR cases : 1245989 Alberta Ltd. v. The Queen 2017 TCC 51
Publication

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