GOLD TRADING

In an October 24, 2014 Technical Interpretation (2013-0473751I7, Mossore, A., 613-948-2227), CRA indicated that gold trading could constitute an adventure in the nature of trade and, therefore, business income. This is consistent with an older Technical Interpretation (October 26, 2010, 2010-0381521E5, D’Angelo, S.) which indicated commodities trading in general would normally be on the account of income, as opposed to capital.

For further information see VTN Monthly Tax Update Seminar, Issue No. 403

GST/HST COLLECTED IN ERROR ON NATUROPATHIC SERVICES

The 2014 Federal Budget added naturopaths and acupuncturists to the list of exempt health care providers effective for supplies made after Budget Day(February 11, 2014).

Released by the Canadian Association of Naturopathic Doctors (CAND) released GST/HST Exemption Update 8 – GST/HST Collected in Error, discusses two options naturopathic doctors can take if they incorrectly collected GST/HST on their exempt services:

Additional details on both of these options can be found in the Update.

For further information see VTN Monthly Tax Update Seminar, Issue No. 403

• • Refund or credit the amount to the patient.
  • Advise the patient that they can claim a rebate of the GST/HST paid from CRA on Form GST189.

REQUEST FOR A CHANGE TO FISCAL PERIOD

In an October 16, 2014 Technical Interpretation (2014-0539401I7, Young, Terry), CRA notes that under Subsection 249.1(7), CRA may accept a change to a taxpayer’s fiscal period. CRA notes, however, that the request to change should only be approved when the request is prompted solely on sound business reasons other than to obtain a tax benefit. Changes for the personal convenience of the taxpayer and to defer taxes would not be permitted.

Any request to change a corporation’s tax year-end will be reviewed on its own merit.

For further information see VTN Monthly Tax Update Seminar, Issue No. 403

FOREIGN SPIN-OFFS – SECTION 86.1 ELECTION

In a December 1, 2014 Tax Court of Canada case (Estate of Frieda Wickham vs. H.M.Q., 2014-1578(IT)I), the Estate paid $19,424 for income management and $25,783 for asset management for a total of approximately $45,000. The Estate claimed only $40,000 of the approved remuneration from the Court as a deduction under Paragraph 20(1)(bb).

See www.cra-arc.gc.ca/tx/bsnss/tpcs/frgn-eng.html for a list of eligible spin-offs.

For further information see VTN Monthly Tax Update Seminar, Issue No. 402

SOURCE DEDUCTIONS – TAXABLE BENEFITS

In a November 6, 2014 Technical Interpretation (2014-0530991E5, Godson, G.), CRA discussed the liability of an employer who fails to withhold taxes as required under Subsection 153(1) in respect of taxable benefits. CRA noted that the payor is only liable for penalties and interest pursuant to Section 227 in respect of Canadian resident employees. However, for non-resident employees, the employer is also liable for the taxes which were required to be withheld (Subsection 227(8.4)).

For further information see VTN Monthly Tax Update Seminar, Issue No. 402