genew

69(1) applies only to transfers of property.

Post by John_molson2003;3038667
你说的很有道理，一般情况下，RPT交易必须要用With Arm's Length 的公允价进行调整。但是我老认为这个原则多适用于“transfer of property“。尽管ITA69 (1)(a)提到“where a taxpayer has acquired anything from a person with whom the taxpayer was not dealing at arm’s length at an amount in excess of the fair market value thereof at the time the taxpayer so acquired it, the taxpayer shall be deemed to have acquired it at that fair market value", 在这里，anything 应该也包含服务。比喻出租房屋给别人或公司。ITA69 见如下链接：

http://www.taxwiki.ca/ITA+Section+69

但是，我能轻易给出反例来。最典型的就是"owner's remuneration"。比喻我朋友给他自己的公司打工，他提供了服务给公司吧，公司是他的，所以他跟公司不是“With Arm‘s Lengh"吧。按道理，公司应该付给他工资，最少也要超过最低工资吧。就算公司不给他开工资，按RTP交易的原则，他也应该把这没收到的工资报到他的收入里去吧。但是现实中，他可以不给自己开工资，也不分红。他的个人收入可以是零。而且这是税务局允许的。为什么工资可以不开，而租金却不能不收了。同样是提供服务，一个是人力，一个是资本。为什么就要区别对待了。当然这里有个细微的差别，工资收入一般是Cash basis.没收到就不用报。而租金是accrual basis，应收款也当是收入。

Anyway, 因为是朋友，所以要慎重点，不想随便几句话打发他。看来还是劝他不要打这个主意了。租金还是照收照报吧。

genew

I didn`t see any case can apply to your situation.  What I suggest is to quantify the risk and calculate the cost-benefit associate with each way.  I think you have a very good point...ìntegration`.  

Post by 协作会计;3039368
首先出租房子是商业行为，然后才是会计行为。

你所说的这条法则这儿不适用。

房子出租的市场价是怎么定的呀？　你的邻居把一层楼租给他亲戚，才收500元一月。然后政府说：“这不行，你必须得租市场价。”　或者商家进货，然后以低价清仓等等。对一些商业行为，政府没有权利干涉吧？

你的朋友公司不挣钱，还是店不挣钱？　是不是有别的房间做别的业务？

后面算的公司税后净得我没核，有一点要注意。QC的小公司税不算太高，但上了一定金额，税率不一样。所以不能一概而论。公司都在抱怨DOUBLE　TAXES，　是有原因的。

QUOTE=John_molson2003;3039176]To mmttll:

你说的有一定的道理。那也是为什么我在前面的回帖中说最低工资应该有的缘故。但是你第二个理由是不成立的。加拿大税法最重要的一个原则是“Integrationrule": 就是说,个人的税负应该是一样的不管他成不成立公司。比喻说，你不成立公司做生意赚$100,你交个人所得税$20.那么你成立公司做生意赚$100,公司交$10公司税，再把剩下的$90,作为红利发给你，你就只应该再交$10个人所得税, 总共的税负都是$20。怎么样实现呢？就是通过DividendCredit来实现的。但是因为这个原则是由联邦政府制定的，而各个省的税率不一样，所以还是有一些差别，但是不会大到影响你做成不成立公司的决定。

我做了个测试，拿我们魁省做例子：你不成立公司做生意赚$10,000。（假设你在最低的税负一档：联邦15%，魁省16%,不考虑其他乱七八糟的Credit,, 因为后一种情况我也不考虑那些Credit),你交$3,100。最后到你口袋里是$6,900。你成立公司赚$10,000。公司联邦税$1,100（11%），魁省税$800(8%), 总共交了$1,900公司税。剩下$8,100作为红利发给你。$8,100先Grossup by 25%变成Taxabledividend: $8,100*1.25=$10,125。联邦税15%：$10,125*15%=$1,518.75。魁省税16%10,125*16%=$1,620。但是政府给你Dividendtax credit: $8,100*.25=$2,025。所以你的个人所得税是$1,518.75+$1,620-$2,025=$1,113.75。最后到你口袋里的是$6,986.25（$8,100-$1,113.75）。差别仅是$86.25,基本上达到了Integration的目的。而且，通过公司，看起来好像是抽了两次税，实际上税负还要低$86.25.

To genew:

I am glad that you have the same feeling as me regarding toITA69(1). Can you tell me besides ITA69(1) is there any other section in IncomeTax Act talking about RPT or Non-arm’s length transaction, which can be appliedto my friend’s case? Or if there is no related section in the Income Tax Act,can you show me some case law could be applied to my friend’s case?

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genew

my experience, and look at the notes in this section.

Post by John_molson2003;3039533
Hi Genew:

Thank you for your comments!. In the previsous post, you said ITA69(1) only applies to transafer of property and doesn't apply to supplying service between related parties. Is this your personal opinion, previous experience in similar cases dealing with CRA or Revenue Quebec, or you have other backup to support your point? For me, I am just worried about the word "Everything" in ITA69(1), as "Everying" can be explained as intangible things like services.

Ciao

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genew

I personally believe this is a very practical question.  I suggest you find a practical solution (for example, a lease contract good for both sides) instead of struggling with the non-arm`s length transaction.

Post by John_molson2003;3039533
Hi Genew:

Thank you for your comments!. In the previsous post, you said ITA69(1) only applies to transafer of property and doesn't apply to supplying service between related parties. Is this your personal opinion, previous experience in similar cases dealing with CRA or Revenue Quebec, or you have other backup to support your point? For me, I am just worried about the word "Everything" in ITA69(1), as "Everying" can be explained as intangible things like services.

Ciao

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genew

This is not "stubborn" at all, but the way to deal with the laws :wink:.
The notes is on page 361.  However, it is just a note.  I agree with you - "anything" can be anything and is not defined in the act.
The fact is that your friend hada historical records with the tax authorities, had the GST/PST accounts registered, and this is indead a "commercial property" at the fist place.  You are right, you will have to take all these into consideration before taking any actions.
Hope I find a attached CRA ruling may help you.

Post by John_molson2003;3039718
Hi Genew,

Sorry for not responding your post last night, as I left my laptop in the company, and I coldd not access Canadian Income Tax Act in my laptop. However, after I checked the Income Tax Act this morning in Section 69(1), I couldn't find the notes your mentioned in the previous post. I use the electronic file: folio view Canadian Income Tax Act downloaded from the Order des compatables agrees du Quebec. I compared it with the content in the link I posted in previous post, they are almost the same. Sorry for my blind, could you indicate more precisely which note you were talking about or can you copy and post the notes you found in the Section 69(1) to the forum?

Sorry for my stubborn, the goal for me is to clear any doubtness and uncertainty about an taxation issue, not necessary aim to the individual case. Thank you again for your suggestion! If both sides have to contract in good faith, there is no way for my friend to avoid to adding the six month rental revenue to his personal income. He has his own G&Q number, and for the first six months, the G&Q applied to the rent have already been remitted to Revenue Quebec. Thus technically, Revenue Quebec knows how much rent for a half year period. If he didn't remit the G&Q for the second six months period, I am afraid Revenue Quebec will conduct an audit to my friend, unless he is free to decide whether he can charge or forgive the rental under Income Tax Act.

Hope to receive your post soon!

Ciao.

To mmttll:

当做生意时，要不要成立公司是一个很有趣的问题，也是注会考试常考的问题。你已经有自己的一些心得，我就不详细阐述了。

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