March 31, 2011

CRA’s Related Party Initiative

Part I

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The Canada Revenue Agency (“CRA”) is launching a new project named the Related Parties Initiative (“RPI”) aimed at wealthy individuals and related entities. The CRA intends to initiate the RPI audits sending a 22 page questionnaire to taxpayers that the CRA has selected for audit.

We recommend that taxpayers who have failed to report taxable income retain legal counsel and initiate a voluntary disclosure as soon as possible. In addition, we recommend that taxpayers who receive the RPI questionnaire retain legal counsel to assist them in providing the CRA with appropriate answers to proper CRA requests for information. Last, we recommend that taxpayers dispute any improper CRA reassessment.

Insights

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The first board conversation in a CRA dispute happens before clarity. This insight explains how early framing shapes control, narrows options, and influences how boards judge management under pressure.

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Redpath shows how transfer pricing disputes can shift late. Strategic venue choice counters systemic advantage and protects business strategy.

Counter Sphere 1 Image, with “Loss Consolidation Under GAAR: When Interpretation and Judgement Decide the Outcome” title text, Counter Tax Litigators LLP: disciplined litigation for critical tax disputes.

Quebecor v. HMK underscores that CRA challenges to loss consolidation hinge on interpretation over mechanics and on whether the outcome aligns with Parliament’s intent.

Counter Sphere 1 Image, with “How Courts Decide When a Transaction Can Be Read Two Ways” title text, Counter Tax Litigators LLP: judgment-driven advocacy in high-stakes tax litigation.

A clear view into how courts choose between competing case theories in tax disputes, and why the business’s real decision environment often shapes the interpretation and outcome.

Counter Sphere 1 Image, with “When Corporate Losses Require More Than Mechanics” title text, judgment-driven advocacy for CEOs and CFOs managing high-stakes CRA disputes

Wuswig v. HMK confirms that under GAAR, economic substance and credible purpose, not mechanical compliance, determine whether corporate losses will stand.

Counter Sphere 1 Image, with “Control and Economic Reality in Cross-Border Dividend Disputes” title text, Counter Tax Litigators LLP: disciplined litigation for critical tax disputes.

Analysis of the Husky Energy withholding dispute and how courts chose among competing case theories by aligning structure, operations, and cross-border reporting.

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Framework Graphic 1 – representing Counter Tax Litigators' integrated approach to client service, combining advanced systems and deep legal expertise to resolve high-stakes tax disputes.

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CRA’s Related Party Initiative

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Related Insights

CRA’s Related Party Initiative

Insights

Management’s First Conversation with the Board in a CRA Dispute

System Advantage and Late-Shifting Positions in Transfer Pricing Disputes

Loss Consolidation Under GAAR: When Interpretation and Judgement Decide the Outcome

How Courts Decide When a Transaction Can Be Read Two Ways

When Corporate Losses Require More Than Mechanics

Control and Economic Reality in Cross-Border Dividend Disputes

How can we help you?

Subscribe

Stay current with our latest insights.