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Category Archives: Canada

The 2023 Fall Economic Statement

November 27, 2023 Sabrina Jackson-Nazareth and Kevin Yip

On November 21, 2023, Chrystia Freeland, the Deputy Prime Minister and the Federal Minister of Finance, unveiled the 2023 Fall Economic Statement (the “Economic Statement”). While the primary emphasis of the economic statement appears to be the Federal Government’s housing action plan and addressing issues of inflation and affordability, it also proposed technical updates on various tax-related matters. This article summarizes the proposed tax measures in the Economic Statement including updated implementation dates to previously announced measures.

Analysis, Canada, Cross-border (Canada/US)

Clean technology investment tax credit

October 19, 2023 Brian Cheng, Katerina Ignatova and Kevin Yip

On August 4, 2023, the Department of Finance (“Finance”) released draft legislation (the “August 4^th Proposals”) in respect of the clean technology investment tax credit (“Clean Technology ITC”), which was initially proposed in the 2022 fall economic statement and updated in the 2023 federal budget (“Budget 2023”). The Clean Technology ITC allows qualifying taxpayers to claim up to a 30% refundable tax credit on the capital cost of clean technology property.

The draft legislation includes labour requirements, which are similar to provisions in the United States Inflation Reduction Act (which in turn references certain labour requirements in the United States Davis-Bacon Act) and that must be complied with to be eligible for the full 30% Clean Technology ITC.

Although Finance announced a clean hydrogen investment tax credit (“Clean Hydrogen ITC”) in Budget 2023, the August 4^th Proposals did not include draft legislation regarding the Clean Hydrogen ITC.

The description of the Clean Technology ITC below is based on the draft legislation included in the August 4^th Proposals.

Analysis, Canada, Cross-border (Canada/US)

Revised proposals to amend the general anti-avoidance rule

October 18, 2023 Sabrina Jackson-Nazareth and Kevin Yip

On August 4^th, 2023, the Department of Finance Canada (“Finance”) released draft legislative proposals which included revised proposals to amend the general anti-avoidance rule (the “GAAR”) in section 245 of the Income Tax Act (Canada) (the “ITA”) (the “Revised GAAR Proposals”). The revised proposals follow several GAAR proposed amendments initially introduced in the 2023 Federal Budget (“Budget 2023”) tabled on March 28^th, 2023.

The proposals to amend the GAAR will apply to transactions that occur on or after January 1^st, 2024, except for the amendments to the preamble to the GAAR and related provisions which will come into force on Royal Assent.

Analysis, Canada

Determining The Province Of Employment For Employees In Remote Work Arrangements

October 11, 2023 Sabrina Jackson-Nazareth and Kevin Yip

The Canada Revenue Agency (“CRA”) is introducing a new administrative policy (the “Policy”) relevant to remote workers to be effective on January 1, 2024. The policy will provide more certainty with respect to the province of employment of employees that are in a remote work arrangement in another province and are “attached” to an establishment of the employer.

Analysis, Canada, Français

Projet de loi C-47 : Entrée en vigueur des nouvelles règles relatives aux opérations à déclarer et à signaler

July 31, 2023 Ronald Nobrega and Devon LaBuik

Le 22 juin 2023, le projet de loi C-47, Loi portant exécution de certaines dispositions du budget déposé au Parlement le 28 mars 2023, a reçu la sanction royale. Ce projet de loi introduit de nouvelles règles qui (i) élargissent considérablement l’étendue des circonstances dans lesquelles un contribuable et ses conseillers doivent déclarer certaines opérations à l’Agence du revenu du Canada (l’« ARC ») et (ii) haussent considérablement les pénalités imposées aux parties qui ne déclarent pas de telles opérations. Ces règles sont applicables aux opérations réalisées après le 22 juin 2023. Le présent bulletin fournit un bref résumé de ces nouvelles règles et des sanctions applicables.[1]