Case Results
Below is a representative sample of the types of cases Norman MacDonald has handled.
• The CRA assessed a taxpayer about $10 million on unfiled tax years. The assessments were based in large part on the CRA’s arbitrary valuation of shares and stock options that the taxpayer had received from the company that he worked for during the assessed tax years. The taxpayer never had the ability to trade the shares due to Securities Commission trading restrictions and protracted litigation over the shares. The share price subsequently plummeted to the point that they were worth only a few thousand dollars. Even then, however, the taxpayer did not have the ability to trade the shares because the CRA had issued a garnishment against the brokerage firm holding the shares. The taxpayer did not appeal the arbitrary assessments within the time limit set out in the Income Tax Act, so the CRA took the position that he was out of time to appeal and refused to accept his Notices of Objection. We sought to file tax returns for the subject tax years, but CRA refused to accept them. We escalated the matter to the Federal Department of Justice and after months of difficult negotiations, the CRA eventually agreed to accept the taxpayer’s filed returns. They re-assessed based on the filed returns which reduced the original arbitrary assessments to about $1 million – a saving of approximately $ 9 million.
• The CRA assessed a taxpayer approximately $250,000.00 as a company director for failing to remit payroll deductions and GST. The CRA had sent the Notices of Assessment to a wrong address. The taxpayer did not become aware of the assessments until two years later when the CRA garnished his wages. We filed Notices of Objection on the basis that he had resigned as a director more than two years earlier, therefore the CRA was outside of the statutory limitation period for assessing him. The CRA Appeals Division refused to accept the taxpayer’s objection on the basis that he was outside of the 90 day time limit for filing an objection. We appealed to the Tax Court where the appeal was allowed and the assessments were vacated and reduced to zero.
• A couple was assessed approximately $300,000.00 by the CRA as directors of a company for failing to remit payroll deductions and GST. The CRA had registered a lien against their home and were threatening further collection action which would have forced them into bankruptcy. We successfully appealed on the basis of the due diligence defence. The appeal was allowed. The assessments were vacated and reduced to zero.
• A taxpayer was assessed approximately $200,000.00 by the Ontario Ministry of Revenue after she purchased a restaurant and failed to get a Tax Clearance Certificate from the Ministry prior to closing the purchase. Under the Retail Sales Tax Act , a purchaser who fails to get a Tax Clearance Certificate is liable, jointly and severally with the seller, for any sales taxes owed by the seller. The seller had left Canada and went back to Iran leaving unpaid taxes of about $200,000.00. The Ministry of Revenue denied our appeal and upheld the assessments. We then sued the lawyer who acted on behalf of the purchaser for negligence in failing to obtain a Clearance Certificate or advising our client of the need to get a Clearance Certificate prior to the completion of the sale. The insurer of the lawyer stepped up to the plate and paid the Ministry of Revenue.
• Successful defense of criminal tax evasion charges. A taxpayer and a company, of which he was a director, were charged by the Ontario Ministry of Revenue with willfully failing to remit retail sales tax. After complex negotiations and pre-trials with the Crown Counsel representing the Ministry of Revenue, the government agreed to drop the charges against the director personally, and accept a guilty plea from the corporation only on a lesser charge. This resulted in no jail time for the company director and savings of about $100,000.00 in penalties.
• A medical equipment supply company was assessed $300,000.00 for failing to collect and remit retail sales tax. We appealed and won on the basis that the company was exempt under the Retail Sales Tax Act.
• A taxpayer was re-assessed for unreported income based on the “bank deposit analysis method”. The taxpayer’s explanations for the deposits were very difficult to substantiate. We appealed to the Tax Court. After lengthy negotiations with Department of Justice lawyers representing the Canada Revenue Agency, we settled the case whereby the assessments were reduced by half.
• A single mother was re-assessed for Child Tax Benefits she had received from the government because she was living in the same house as the child’s father after they became legally separated. We appealed on the basis that although the parties were living in the same house, they were in fact living “separate and apart” under the law, and the mother was therefore entitled to the benefits. The appeal was allowed.
• Have successfully negotiated many tax amnesty applications with the CRA.
• Have successful negotiated payment plans with the CRA and the provincial Ministry of Revenue.
• Have had tax liens removed.
• Successfully sued a firm of accountants that gave wrong tax advice to a client.
• Have advised on the formation of asset protection structures in various offshore jurisdictions.
• Have successful represented both employers and employees in wrongful dismissal and human rights claims, and advised on the tax implications of their awards.
• Have successfully represented clients in international commercial arbitrations.
• Have advised on enforcing foreign judgments in Canada.
• Have advised on many international corporate and commercial transactions on 18 different countries.
• Have successfully represented both plaintiffs and defendants in intellectual property infringement and passing off cases.