in lieu of

13 September 2012 Internal T.I. 2012-0442671I7 F - Dédommagement pour la perte de bénéfices -- summary under Subsection 6(3)

The former employees and retirees of a bankrupt corporation (the "Employer") received a lump for the cancellation of their rights in a group insurance plan and respecting legal costs incurred to recover the lump sum. The lump sum received for the Plan cancellation included compensation for the loss of medical and dental coverage and hospitalization coverage for themselves and their dependents (respecting the "Medical Plan"), as well as the loss of life insurance coverage (the "Coverage").

By services, 13 November, 2017

Scott v. The Queen, 2017 TCC 224 -- summary under Subparagraph 56(1)(a)(iii)

In 1980, Nortel had established a health and welfare trust (the “HWT”) for its employees. Following its insolvency and filing under the CCAA (with the related CCAA proceedings being court-supervised), it made lump sum payments in 2011 to the taxpayers, pursuant to a court-approved settlement agreement, in satisfaction of their entitlement to payments under the HWT. Mr. Scott, had been the husband of a full-time non-unionized employee, and had been receiving monthly survivor income benefits following her death, that had been included in his income under s. 56(1)(a)(iii) as death benefits.

27 June 2016 External T.I. 2016-0637341E5 F - Partnerships - Negative ACB -- summary under Subparagraph 53(2)(c)(v)

Rather than making current distributions of its cash flow to a limited partner, those sums are lent by the LP to the limited partner – then at the beginning of the following year the LP effects a distribution of the applicable share of the previous year’s profits to the limited partner by issuing a demand note to it and pays that note by way of set-off against the loans owing by the limited partner. Does this approach avoid negative ACB gains under s. 40(3.1)?

By services, 28 November, 2015

Pechet v. Canada, 2009 DTC 5189, 2009 FCA 341 -- summary under Subsection 216(1)

The non-resident taxpayer received rents from Canada in 1997 to 2001 without withholding of Part XIII tax, and in 2002 filed returns under s. 216(1) in respect of those years in which she showed no Part I tax owing due to the claiming of expenses. The taxpayer was assessed for her joint liability under s. 227(8.1) for interest that had accrued, up to the date she filed her returns, on the Part XIII tax on the rents that the resident Canadian payor thereof had failed to withhold and remit.

By services, 28 November, 2015

Transocean Offshore Ltd. v. Canada, 2005 DTC 5201, 2005 FCA 104 -- summary under Subsection 212(1)

Lump-sum damages received by the non-resident taxpayer from Canadian residents for the repudiation, prior to the slated operational commencement date, of a bare-boat charter of a drilling rig owned by its parent, were found to be payments received in lieu of the payment of rent, so that it was not entitled to a refund of Part XIII tax withheld. After noting (at para.

By services, 28 November, 2015

Holzhey v. The Queen, 2008 DTC 2607, 2007 TCC 247 -- summary under Paragraph 12(1)(c)

The deemed disposition by the taxpayer, as a result of his ceasing to be a resident of Canada, of a loan made by him to a non-resident corporation on which there was accrued but unpaid interest resulted in him being thereby deemed to receive an amount "in lieu of" the payment of interest. In the Transocean case, amounts paid in respect of the anticipatory breach of a rental agreement were found to be a reasonable substitute for rent payable under the agreement; and similarly, here "the deemed proceeds were a reasonable substitute for the accrued interest". (para. 37)

By services, 28 November, 2015

Hall v. MNR, 70 DTC 6333, [1970] CTC 510 (Ex Ct), briefly aff'd 71 DTC 5217 (SCC) -- summary under Paragraph 12(1)(c)

An individual taxpayer, who in two successive years clipped and sold overdue coupons in the amount of $10,000 on his Canada bonds to the trustee for five RRSPs (the beneficairies of which wre unrelated) for a sale price of $9,000, was held to have (1) received the sale proceeds as interest and (2) as a payment "in lieu of payment of... interest."

With respect to the first ground, Sheppard DJ stated (at p. 6335, DTC):

in lieu of