Paragraph 7(b) of Article IV of the Canada-United States Tax Convention (1980) (the “Canada-US Treaty”) includes an anti-hybrid entity rule that may deny treaty benefits on interest and other payments from a Nova Scotia, British Columbia or Alberta unlimited liability...
Historically, Canadian multinationals have generally been entitled to deduct interest incurred in respect of borrowed funds used to invest, directly or indirectly, in foreign affiliates. The deductibility of interest related to the financing of foreign affiliates combined with the favourable...
On December 4, 2009, Justice Hogan of the Tax Court of Canada issued his Reasons for Judgment in the case of General Electric Capital Canada Inc. (“GECC”) v. The Queen (2009 TCC 563). GECC, a Canadian corporation, operated a financial...
Canadian withholding taxes on interest paid by a Canadian resident borrower to a non-resident of Canada that deals at arm’s length with the Canadian borrower was eliminated for most interest payments on or after January 1, 2008. However, the Canadian...
The recent decision of the Tax Chamber of the United Kingdom in Laerstate BV v. HMRC [2009] UKFTT 209 (TC) has caused a stir on both sides of the Atlantic ocean for those interested in corporate residency matters. While not...
On October 15th, 2009, the Quebec Ministry of Finance released an Information Bulletin containing new rules aimed at fighting “aggressive tax planning” (“ATP”) schemes. These measures give additional tools to Revenue Quebec to identify and attack aggressive plans designed to...
