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TAXATION OF CORPORATE REORGANIZATION
Conference held in Toronto on January 18, 19 & 20, 2006
Chairs: Greg C. Boehmer, Ernst & Young LLP; Mark Brender, Osler Hoskin & Harcourt LLP; Patrick J. Boyle, Fraser Milner Casgrain LLP; Brian M. Schneiderman, Borden Ladner Gervais LLP
CD-ROM: App. 11 hours of video presentations and plus over 440 pages of original material
To purchase, please contact Federated Press.
HOT TOPICS & FUNDAMENTALS
Panel: Taxation of corporate reorganization – Current issues & future trends
Mark Brender and Firoz Ahmed, Osler, Hoskin & Harcourt LLP; Edward A. Heakes, Macleod Dixon LLP; Gloria Geddes, Gowling Lafleur Henderson, LLP
- Canada Trustco: common law series
- Evans
case law: avoidance transaction
- Effect of amended 245(4)
- La Survivance v. The Queen
case law: deeming provisions
"Two cases that have had a recent impact on the issue of taxation of corporate reorganizations, including the concept of common law series and the effect of deeming provisions, have been Canada Trustco and La Survivance v. The Queen."
Video: 80 minutes • Overheads
Paid-up capital and internal reorganizations
William J. Bies, Fasken Martineau DuMoulin LLP
- Determining paid-up capital (PUC)
- Calculating PUC
- Determining stated capital
- Property transfers: section 85
- Surplus stripping: section 84.1
"Close attention must be paid to property transfers, surplus stripping and amalgamations when considering the effect of reorganizations and PUC adjustments under the Income Tax Act."
Video: 25 minutes • Overheads
Amalgamations and wind-ups: The 88(1)(D) bump
Stephen S. Ruby, Davies Ward Phillips & Vineberg LLP
- Application of the 88(1)(C) bump
- When the 88(1)(C) bump does not apply
- Prohibited persons and specified shareholders
- Examples of substituted property
- Finance Canada comfort letters – Section 251(5)(b)
"The 88(1)(D) Bump is one of the most intricate rules of the Income Tax Act. It is best analyzed by understanding the prohibition of persons, and the categories of substituted property."
Video: 54 minutes • Overheads
Taxable preferred shares
Daniel R. MacIntosh, Osler, Hoskin & Harcourt LLP
- Definition of "term preferred share"
- The subsection 191(4) exemption
- Guaranteed preferred shares
- Taxable preferred shares
- Share redemptions and issuer bids
"It is important to understand the taxable status of preferred shares in Canada, as it can have a crucial impact on restructuring and preferred share financing."
Video: 27 minutes • Overheads
CROSS-BORDER STRATEGIES
Structuring foreign affiliates
Penny Woolford, KPMG LLP
- Structuring considerations: overview
- Canadian technical rules
- Structuring objectives and planning
- Anti-avoidance considerations
"With the increasing number and complexity of foreign affiliate tax elections, it is becoming very important to ensure being up to date so as to effectively structure one's foreign affiliates."
Video: 41 minutes • Overheads
Exchangeable share transactions
Dov B. Begun, Osler, Hoskin & Harcourt LLP
- Exchangeable shares: attributes and rights
- Structuring the transaction
- Tax considerations: FIE rules
- Private equity: cross-border rollover rules
"Exchangeable shares have certain attributes and rights that make this vehicle attractive in the right circumstances for the shareholders."
Video: 35 minutes • Overheads • Paper 39 pgs. (7,951 words)
Recent developments in income trusts
Barbara J. Worndl, Aird & Berlis LLP
- The Canadian income fund market
- Income fund: valuations
- Tax impact of distributions
- Department of Finance announcements
"The ultimate success of an income trust depends on that particular business' strength and stability in generating sustainable cash flow."
Video: 48 minutes • Overheads
ACQUISITIONS STRATEGIES
Panel: The latest tax-avoidance developments relating to reorganization
Patrick J. Boyle, Fraser Milner Casgrain LLP; Terrance A. Sweeney, Borden Ladner Gervais LLP
- The SCC and GAAR – decisions of the Supreme Court
- Crown's Factum in Canada Trustco
- SCC rejection of Crown's appeal
- The SCC and GAAR: misuse or abuse
"The Supreme Court of Canada has basically taken the position that tax rulings must, above all, be rendered in conjunction with the spirit and intent of the Canadian Parliament and its tax legislation."
Video: 39 minutes • Overheads • Papers 64 pgs. (13,350 words)
Takeovers and tax issues
Alan M. Schwartz, Q.C. and Mitchell Thaw, Fasken Martineau DuMoulin LLP
- Deferral of capital gain by vendor
- Deductibility of costs of making or fighting a takeover bid
- Tax cost of assets and structure for the bump
- Tax planning for foreign purchasers
- Capital gains reduction through safe income distribution
- Change of control implications
"Among the important tax issues to be considered in takeovers, those that plan for the vendor differ from those that plan for the purchaser."
Video: 25 minutes • Overheads • Paper 51 pgs. (11,487 words)
Tax-effective financing of acquisitions
Richard Lewin, Heenan Blaikie LLP
- Financing with equity
- Financing with debt
- Draft proposals on deductiblity of expenses
- Consolidating the purchaser and the target corporation
- Interest deduction and capital tax
- Financing issues relating to non-resident lenders
"Acquisition decisions, which are determined by the twin pillars of cash flow and capital expenditures, must then be followed up by the proper planning for the tax consequences regarding the financing, which may include shares, preferred shares and debt."
Video: 38 minutes • Paper 71 pgs. (14, 447 words)
Use of tax losses
Gerald D. Courage, Miller Thomson LLP
- Triggering accrued losses: the stop-loss rule
- Utilization and preservation of losses with an affiliated corporate group
- Partnerships between profitable and loss corporations
- Treatment of tax losses on an acquisition of control
"The three major elements in the use of tax losses to be considered are the triggering of accrued losses, the utilization of realized losses with an affiliated corporate group, and the treatment of tax losses on an acquisition of control."
Video: 46 minutes • Overheads • Paper 114 pgs. (33,720words)
TOPICAL ISSUES IN CORPORATE REORGANIZATIONS
Divisive reorganizations: Subsections 55(2) and paragraphs 55(3)(A)
Mark Brender, Osler, Hoskin & Harcourt LLP
- Computation of safe income: judicial and administrative developments
- Divisive reorganizations and paragraph 55(3)(a) exemption
- Triggering events analysis
- Traps and planning opportunities
- Administrative positions of the CRA
"The raison d'etre of subsection 55(2) is to prevent the transfer of a tax deferred asset to a third party utilizing intercorporate deductions."
Video: 39 minutes
Divisive reorganizations and "butterfly" transactions
Brian R. Carr, Fraser Milner Casgrain LLP
- The development of the "butterfly" and its abuses
- Internal and divisive reorganizations
- Administrative rules
- Types of property difficulties
- Post-butterfly restrictions
"The current status of the "butterfly:" as understood under paragraph 55(3)(b) plays a key role in the process of divisive reorganizations."
Video: 43 minutes • Overheads • Paper 60 pgs. (11, 656 words)
Pension obligations & reorganizations
Gregory J. Winfield, McCarthy Tétrault LLP
- Overview of benefit plans
- Share purchase or sale transactions
- Corporate amalgamations
- Asset purchase and sale transactions
- Restructuring in insolvency
"The three major elements in the use of tax losses to be considered are the triggering of accrued losses, the utilization of realized losses with an affiliated corporate group, and the treatment of tax losses on an acquisition of control."
Video: 30 minutes • Overheads • Paper 57 pgs. (25, 365 words)
Debt restructuring
Ron Choudhury, and Kathleen S.M. Hanly, Fasken Martineau DuMoulin LLP
- Distress preferred shares
- Debt forgiveness rules
- Equity for debt
- Debt for debt
- Debt parking
- Acquisition of control planning
"The highlights of the Income Tax Act that deal with corporate debt restructuring include debt forgiveness, equity for debt, debt for debt, and debt parking."
Video: 35 minutes • Overheads |