The Canada Revenue Agency had an important win this week in its
efforts to access information outside of Canada. On March 20,
2013, the Federal Court issued its decision in
v. M.N.R. 2013 FC 291, dismissing Soft-Moc's judicial
review application to have the CRA's decision to issue a
Foreign-Based Information Requirement set aside or varied.
The CRA has broad powers to access information related to the
determination of a taxpayer's tax obligations. Under
subsection 231.6 of the Income Tax Act, these powers include the
issuance of a Foreign-Based Information Requirement to obtain
information or documents located outside of Canada.
In Soft-Moc, the CRA was conducting a transfer pricing audit and
sought information from corporations in the Bahamas who provided
services to Soft-Moc. These corporations and their individual
Bahamian resident shareholder owned 90% of the common shares of
Soft-Moc. The CRA issued a Foreign-Based Information
Requirement to Soft-Moc under subsection 231.6(2) of the Income Tax
The Requirement requested substantial amounts of information
related to the Bahamas Corporations including extensive details of
the services provided, customers, financial statements, costs and
profits and employee data. Soft-Moc applied for judicial
review of the decision to issue the requirement.
Primarily, Soft-Moc argued that the information requested went
well beyond that necessary to enable the CRA to complete the
transfer pricing audit and that the decision to issue the
requirement was, therefore, unreasonable. Soft-Moc
argued that a portion of the information requested was irrelevant
and that some portions were confidential or proprietary.
The Court was not sympathetic to Soft-Moc's arguments,
noting the wide-ranging statutory powers of the CRA to collect
information and the low threshold to be met in determining whether
the requested information is relevant and reasonable.
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Don’t miss the opportunity to enjoy some holiday cheer by supporting this year’s Christmas Bureau Breakfast. We hope you will join us bright and early on Tuesday, December 13 at 7 a.m. for breakfast hosted by Edmonton media personality, Bridget Ryan, and Dentons’ own Andy Hladyshevsky.
For the past 76 years, the Christmas Bureau has been providing festive meals to Edmontonians in need. This year they need your help more than ever as they anticipate serving close to 70,000 people of whom 47 percent are anticipated to be under the age of 17. Please help us help them by buying a table or making any donation to the Christmas Bureau. No amount is too small; every nickel counts.
A table of 10 is $850 and will have your company name prominently displayed on a placard at the table. Individual tickets can also be purchased for $85. A charitable donation receipt per purchase will be available only upon request. Many groups organize fundraising activities in their offices and make their donations at the breakfast.
“It is greater than one meal. One act of kindness can impact someone for a lifetime.”
Another self styled educator with the Paradigm Education Group tax protester movement has been sentenced to a jail term for tax evasion and counselling others to evade as a result of a successful tax prosecution.
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