How to Apply for Leave to Appeal to the Supreme Court of Canada: Top 5 Tips for a Winning Public Importance Pitch

The Supreme Court of Canada is truly every litigant’s last kick at the proverbial can. You may have fought the good fight and won at trial, only to lose before a provincial appellate court. Or you might might have lost in every court, but believe your case is worth one last shot. The Supremes have the last judicial word word as the highest court in Canada.

But you don’t have a right to go to the SCC in almost all but a few very narrow situations. You’ve got to ask for permission, known as seeking leave to appeal. Only about 1 in 10 cases that seek leave are granted it. Here are my top 5 tips to maximize your chances of grasping that golden leave ring.

1. Be on Time With Serving and Filing for Leave to Appeal

You’ve only got 60 days from the date of the judgment you’re seeking leave to appeal on to serve and file a complete leave to appeal application with the Supreme Court of Canada. We’re not talking just a flimsy notice here, but rather filing the entire package (which is why they’re giving you 60 days, rather than the more common 30 days to file a notice of appeal).

Far better a so-so leave to appeal application record filed on time, than a perfect application filed late. Courts hate extending statutory limitation period filing deadlines. If you miss the 60 day limitation, you’re probably dead, even though technically you can ask for an extension.

2. Understand Limits of S. 40 Supreme Court Act Jurisdiction

Only judgments from the highest court of any province, or the Federal Court of Appeal, can usually be subject to a Supreme Court of Canada leave application. There are a few rare exceptions to this, but generally you need to have exhausted all possible appeals in the provincial or federal courts system before petitioning the Supremes.

However, importantly you don’t need a “final” judgment on which to seek leave. An interlocutory temporary order could be just as much the subject of a leave to appeal application.

3. Know How to Sell the “Public Importance” Test

The Supremes don’t care if you’ve been wronged by a court of appeal. They don’t care if a court of appeal erred in law. They’re already perhaps the busiest court of last resort in the Commonwealth. They don’t need any more work.

So Parliament set out in s. 40 of the Supreme Court Act that they should only take on appeals where “the Supreme Court is of the opinion that any question involved therein is, by reason of its public importance or the importance of any issue of law or mixed fact and law involved in that question, one that ought to be decided by the Supreme Court or is, for any other reason, of such a nature or significance as to warrant decision by it….”

What this means in practice is that you’ve got to sell the ramifications of your case, and the appellate judgment concerning it that you want to overturn, as extending way beyond your personal facts. Ideally, you want to sell it as being so publicly important, that it’s of national importance, though “national” isn’t an official requirement.

4. Why is This the Right Issue, on the Right Record, at the Right Time

Veteran of the Supremes Mr. Justice Cromwell suggested in a seminar selling the Court on why this is the right issue, on the right record, at the right time, in order to best convince them why they should give you leave.

The right issue point is selling public importance. But his point was that’s only a third of the test, which also requires you to persuade that the record is right, meaning that the facts aren’t a total mess, or completely absent, such that the Court would be able to come to a sensible legal decision based on a full coherent factual record, rather than waiting for a similar case to come along that perhaps has clearer facts.

His last point of the “right time” at least in part revolves around when the Court might have last considered the issue (if ever), whether Parliament has or is considering the issue by way of legislative solution, and whether the appellate courts of the provinces have sufficiently considered the issue so as to have evolved into a contradictory jurisprudential patchwork that requires clarification.

5. You Must Use an Ottawa Agent

Courts can be a little traditional in their practices. The Supreme Court of Canada was established in days of horse and buggy, where getting materials out of Montreal, or Toronto, or even Vancouver to be filed with the Court could be quite an ordeal. And just like courts today, there was a good chance that once your materials did land on the desk of the Court Registrar, some technical thing was going to be found wrong with them.

Technical deficiencies in court materials can have really simple, one hour, swap out a document for another document types of fixes, but not if your horse and buggy - or rail car - needed to travel back to Montreal, Toronto or Vancouver to make the fix. Plus the SCC rules are quite unique as compared to the rules of any other court, meaning you don’t want lawyers trying to interpret them who only deal with one case there every 20 years.

Section 16 of the Rules of the Supreme Court of Canada provide that “A party to an appeal or to a reference to the Court shall only conduct business with the Registrar through an agent.” Section 2 of the Rules defines “agent” as “a lawyer practicing in the National Capital Regional within the meaning of the National Capital Act.” There are a few of us local to the NCR who both conduct SCC appeals (and leave to appeal applications), as well as act as agents for out of jurisdiction lawyers.

Gordon S. Campbell serves as counsel throughout Canada on Supreme Court of Canada leave to appeal applications and appeals. He will co-counsel or act as agent for lawyers from outside the NCR dealing with the SCC. He previously served with the Constitutional Law Division of the Attorney General of Ontario and the Department of Justice Canada.

The 5 Rules for Successful Access to Information & Privacy Act Requests for Government Information in Canada

Governments know a lot of stuff. But it’s sometimes very difficult to pry any of that knowledge away from them. 

The early 1980’s marked the start of the openness era for many governments, including Canada which introduced the Access to Information Act and the Privacy Act (collectively known as ATIP) in 1983. The Privacy Act enables individuals to request personal information that the government holds about them, whereas the Access to Information Act enables anyone to request government records generally, subject to numerous exceptions. 

Canada has more recently followed the lead of other countries with “Open Data” projects that put government gathered data - often of a statistical nature - into the public domain, so that others can make use of it. Though some data remains closely guarded. And we lag behind other places in putting raw documents (or really much of anything of a timely nature) online for easy download.

For a while I served as Canada’s Director of E-Business Development. Not surprisingly, our Electronic Commerce Branch of Industry Canada had a series of website pages explaining what we did, and containing links to useful sources. In essence, we were in charge of the Internet from the Government of Canada’s perspective. Think I was able to change even one word on that website during my entire tenure as Director? Nope. 

Government putting it all out there online (even for sensitive private matters that might cause legitimate pause in Canada) is especially prevalent in the United States where the then world leading Freedom of Information Act was implemented as early as 1966. The White House even puts its legal opinions online (though by retaining private counsel this openness can be somewhat circumvented)!

So Canada’s governments (and really any governments outside the U.S.) can be a little slow at information dissemination. Governments are often more reactive, than proactive, when it comes to information sharing. But government functionaries can actually be quite helpful if you know who and how to ask for the right information that you need.

Getting a useful response to an ATIP request involves a lot more than luck. As an information and privacy lawyer, who used to work inside government on such requests and who now assists private clients in getting information out of government, here as my top 5 rules for writing winning requests. I actually call these “rules” rather than “tips” because if you ignore these points, you likely won’t be getting any useful results for your efforts.

While this post is focussed on federal Government of Canada access to information and privacy laws, its principles would apply equally to provincial government access and privacy legislation which often works in quite similar ways. 

1. Target Correct Government Department for Information

The government operates in silos. Contrary to what you might think from watching TV shows about high tech pan-government all-knowing data systems displayed on giant screens in darkened rooms - modern version’s of Kubrick’s Dr. Strangelove bunker warroom - at least for Canada government information systems are often old, creaky and not interconnected.

The government doesn’t operate in the cloud, because the government doesn’t trust the security of the cloud. But the result at least some of the time is old file servers in dusty closets and paper files of undigitized information. 

With luck, a single government department knows what information it possesses. But it definitely doesn’t know what’s in the hands of other government departments. And government departments often don’t like to share or play well together

So the first principle of good access and privacy requests is to get the department right where you think the information you want resides. If you’re not sure, make requests to multiple departments. It’s cheap fun. Depending, of course, on your idea of fun.

2. Be Precise About Subject & Date Range of Information You Need

Don’t be too general in your request for information. The easier you make the government workers’ jobs in finding you the information you want, the more information you’re likely to get.

If you want a specific record, name it. If you want records on a specific topic, be precise about that topic. Likewise be precise about the date range for records. 

The Access to Information Act defines “record” as “any documentary material, regardless of medium or format.” So asking for “records” is probably your best bet, rather than a long winded description of emails, power point presentations, briefing notes, and the like.

There is a balancing act between being too precise in your request so that you get nothing, and not being precise enough so that again you get nothing. Generally speaking it’s better to be too precise than too general.

Too precise might require you to draw back a bit and submit a second slightly more general request, but the government’s access to information coordinators can actually be quite helpful in shaping requests to make them more responsive. Give them a specific record target, and they will work with you. Give them a dump truck of information that you want, and they may not be so accommodating.

3. Ensure Right Person is Making Request for Information

Under the Privacy Act, you can only request your own information. Under the Access to Information Act, only a person or corporation inside Canada can request information. Using an authorized agent inside Canada with a Canadian address to request the information for you is fine. Just don’t try to get the government to provide information to you outside Canada or as a non-Canadian. Work with a Canadian inside Canada (like a lawyer) if you are outside Canada or a non-Canadian.

Send along a use of a representative signed authorization form if you are working with an agent or lawyer to request information for you, since the government needs official authorization to send the requested information to someone other than you. 

4. Resubmit Redrafted Request if You Don’t Get What you Need

Because of my “cheap fun” point above, unlike a legal procedure like a court action which has a huge cost to recommence from the start if it fails, and might not even legally be possible to get going again because of res judicata, nothing stops you from resubmitting variants on earlier ATIP requests. Use a different date range. Use different keywords. Think of it like a very slow Google search.

Maybe the information you’re looking for doesn’t exist. Or maybe you just didn’t ask for it in the right way.

Sending in hundreds of additional requests for information are likely to be deemed frivolous, and eventually the government will stop working with you. But a couple of additional requests, aiming at slightly different targets on the government information rifle range, might score a bullseye where your first request totally missed the mark.

5. Be Prepared to File Complaints on Exemption Claims to Information or Privacy Commissioners

Appeals of denials of information - either under access or privacy requests - can be a lot of hassle, and take a lot of time. Better first to just work with the government department in question to see if you can resolve the issue amicably. Maybe documents can be edited to give you some information, rather than sending you reams of blank sheets in response to your request.

When I was responsible for responding to one legal demand for disclosure of a voluminous government operations manual as part of a court case, I spent days blanking out page after page, or leaving in a line here and there, concerned that putting it all out there would compromise government security. I later found out the litigant had also made an Access to Information Act request outside of the court process, for the exact same material, and received about 90% more information than I was ready to release because that government department had stacks of pre-vetted “sanitized” operations manuals pre-printed just sitting in a warehouse, waiting for someone to ask for them.

So don’t assume that access to information coordinators are there to frustrate you. On the contrary, they’ll probably be way more helpful than lawyers like me would be who always tend to take conservative views of public disclosure. Access coordinators have as a primary role the promotion of the release of information, not its suppression.

But sometimes you’ll run into a wall, being told information does exist within government, but that you’re not going to get it because of one of a few notable exemptions. The most commonly cited exemptions are:

a. information obtained in confidence from another government;

b. information injurious to conduct of federal-provincial affairs;

c. information injurious to conduct of international affairs or defence;

d. law enforcement information;

e. information injurious to economic interests of Canada including contractual negotiations;

f. personal information (as defined in the Privacy Act);

g. third-party trade secrets, financial, commercial, scientific or technical information “treated consistently in a confidential manner by the third party,” or which could reasonably be expected to prejudice the competitive position of a third party or interfere with contractual or other negotiations of a third party;

h. advice, recommendations or plans for government operations;

i. solicitor-client privileged information.

Government invoking one of these exemptions to information disclosure could be quite legitimate. But the statutory language of the exemptions is very technical, thus whether they apply or not might involve nuanced judgment calls subject to arguable disagreement. 

Complaints over refusals (or unreasonable demands for production fees) may be made to either the Information Commissioner (for Access to Information Requests) or the Privacy Commissioner (for Privacy Act Requests). They both have investigative powers and the ability to make recommendations on disclosure. Court action on information denial is also possible.

Following these “rules” may not get you everything your want every time out of an access to information or privacy request, but they should at least maximize your prospects of success of getting something responsive, instead of just a stack of blank pages.

Gordon S. Campbell is an information and privacy lawyer who assists clients throughout Canada with obtaining information from all levels of government. He has served with the Department of Justice Canada, the Attorney General of Ontario, the RCMP, the Canadian Armed Forces and Global Affairs Canada, as well as litigated public law cases up to the level of the Supreme Court of Canada. Learn more at www.acmlawfirm.ca.

Must I Consent to a Police Search Request? And the Uncontrollable Urge to Say "Yes"

"No." Unlike some of my what can unfortunately seem like long winded and not as definitive as clients might like answers, consent to search spawns a clear cut single word answer. At least in Canada. 

Police questioning is totally different from police searches as to whether you have a choice or not in responding. While my default advice is always “say nothing” in response to police questions, unfortunately the real world is much more nuanced than that. Sometimes you must answer police questions, depending on what they are asking about (like insurance automobile questions). And sometimes it's in your best interests to answer police questions in an attempt to clear up suspicions and avoid being charged, even if you aren't obliged to answer (though often its not a good idea to do so). But never do you have to consent to a search.

Either the Police Have a Power to Search or They Don't

Either the police have powers and grounds to search, or they don't. It's only when they don't have grounds that they might ask you a question after a highway speeding stop like: "you mind if I take a look in your trunk?" And sometimes if you do say "no", you might get a response like "hey, if you don't have anything to hide, why would you say no?" Your best response is to remain firm and polite in your "no." At the very least, call a lawyer for advice. 

Sometimes, the police might even pull out a form for you to sign, which says that you've been told: (1) you don't have to consent, (2) that you can withdraw your consent at any time, and (3) anything found during the search can later be used against you as evidence in court. Now reading this, you might be thinking: "Why would anyone consent? I would certainly never consent! I'm not that stupid!"

Why Do So Many People Consent to Police Searches?

But thousands of people a year throughout Canada (and in other countries with similar constitutional protections against unreasonable search and seizure, like the United States) do just that, and consent to searches where the police have no grounds to search. Some even carefully read those forms, do understand them, but sign anyway. Why?

It seems to be something to do with people feeling that: (1) they have no choice, (2) they have nothing to hide, or (3) even though they do have something to hide, the police won't find it, and this is the best way to get rid of them. These "yes" men and women are wrong on every count. 

First, you do have a choice if the police ask if you mind if they do a search. Be it a search of your vehicle, a search of your house or office, a search of a bag you are carrying, or a search of your person, just say that you do mind. Be polite about it. You can even ask whether the police will go ahead without your consent, because they believe they have some kind of other authority?

The Police May Already Have Other Authority to Search Anyway

Sometimes the police will already have - or have sufficient grounds to obtain - a search warrant to search your vehicle, house or office. If they do, then your consent is irrelevant. Don't try to stop the police from executing a warrant (or otherwise conducting any kind of search), unless you want to be charged with obstructing justice. But they must get the warrant from a judge or justice before conducting a search, or have some other kind of lawful power to search without consent. 

Sometimes the police will already have grounds and powers to search incident to arrest without a warrant. Again, if they do then your consent is irrelevant. But they must have first arrested you, told you what you are being charged with (unless it is an emergency), and not exceed the limits of the search incident to arrest power (usually limited to your person and what you are carrying - though occasionally it might extend to a vehicle you are in; it will never extend to your whole house or office). 

Sometimes the police will be able to invoke exigent circumstances to search without a warrant or arrest if there is an emergency situation, where the search just can't wait. Again, your consent will be irrelevant. Though be aware that true exigent circumstances searches are very rare, since the police do have investigative detention powers to hold you, your vehicle, or even your home or office for a reasonable period of time pending the arrival of a search warrant. 

All Consent Searches are Vulnerable to Challenge

If my police powers to search explanation is starting to sound a bit complicated, that's because it is complicated. Lawyers and judges disagree frequently about when particular powers exist, and well intentioned police officers can certainly get it wrong if the judges are having trouble getting it right. Though throughout the training I still do for police officers on search and seizure, the best mantra for those officers to repeat is: "if in doubt, get a warrant." I especially teach my police students: never rely on consent, it's too uncertain of an authority, with too unpredictable later results. 

If you are the subject of a police search - by consent or otherwise - and something incriminating is found that leads to you being charged, my recommendation is to consult a lawyer about your prospects for challenging the search in court. I'm not saying you are guaranteed success on such a challenge, but in my experience most people never challenge police searches. Sometimes a search will be completely legal, and sometimes it won't be. But only by involving a lawyer will you be able to find out which category your search falls into.

No One Would Believe This In a Movie Script

While serving as a Federal Crown Prosecutor I once was involved in a case where a BMW speeding along the TransCanada Highway was stopped by police for a traffic violation. The stopping officer only had grounds for a traffic violation, but his suspicions were quite appropriately aroused.

The occupant of the fancy car seemed overly polite when stopped. And overly nervous, constantly shifting in his seat, eyes darting about, hands tightly gripping the steering wheel. Plus the vehicle had out-of-province plates, and the conscientious officer remembered from his training that fast food wrappers strewn about a car might be a sign that the occupants were driving non-stop over a great distance for illicit purposes (yes, there is a course on that, I've seen the materials; it might motivate all of us to tidy our vehicles). 

So, after giving him a speeding ticket, the officer asked the driver if he minded if the officer took a quick look in the trunk of the car. This officer was very well trained, and made it clear to the driver that he didn't need to consent, that he was free to go, and that anything he found could be used against the driver in court. The officer even pulled out a consent form for the driver to sign. Now what the officer definitely didn't know in advance was that the driver had 10 kilos of coke and $100,000 in cash in the trunk. And what do you think that driver did? He signed, and popped the trunk!

Gordon S. Campbell practices criminal defence law throughout Ontario, with a focus on search and seizure cases which he has appeared on up to the level of the Supreme Court of Canada. He also trains law enforcement agencies throughout Canada on search warrant & wiretap drafting, and is author of The Investigator's Legal Handbook series of books.

Le droit de garde et d’accès pour les grands-parents : trois erreurs à éviter

Le rôle des grands-parents dans la vie des petits-enfants

Les grands-parents peuvent jouer un rôle essentiel dans la vie d’un enfant et soutenir les parents dans l’éducation de ce dernier. Beaucoup de grands-parents offrent de s’occuper de leurs petits-enfants sans rémunération et prennent le temps de faire des activités avec ceux-ci. De plus, les grands-parents peuvent représenter un point de référence culturel pour que les petits-enfants comprennent mieux l’histoire de leur famille. Par ailleurs, certains grands-parents contribuent aux dépenses financières des parents pour offrir de meilleurs opportunités éducatives, religieuses ou sociales aux enfants, ce qui finit par aider l’enfant à s’épanouir.

Les éléments pris en compte pour obtenir la garde ou l’accès aux petits-enfants

Au cours de l’histoire du droit de l’enfance, deux tendances se sont développées : d’un côté, les décisions en faveur de l’autonomie parentale, de l’autre côté, les décisions favorisant l’intégration des grands-parents dans la vie des enfants. En Ontario, depuis 2016, la Loi portant réforme du droit de l’enfance autorise de manière explicite les grands-parents de réclamer la garde et l’accès de leurs petits-enfants.

Lorsque les grands-parents présentent une requête pour avoir des droits de garde ou d’accès à leurs petits-enfants, les tribunaux prennent en considération les facteurs suivants :

• l’amour, l’affection et les liens affectifs qui existent entre l’enfant et les grands-parents
• le point de vue et les préférences de l’enfant, dans la mesure où il est raisonnablement possible de les déterminer
• la durée de la période pendant laquelle l’enfant a vécu dans un foyer stable
• la capacité et la volonté des grands-parents de donner des conseils à l’enfant, de s’occuper de son éducation, de lui fournir les objets de première nécessité et de satisfaire ses besoins particuliers
• le projet des grands-parents relatifs aux soins et à l’éducation de l’enfant
• le caractère permanent et stable de la cellule familiale où l’on propose de placer l’enfant
• l’aptitude des grands-parents à agir en tant que parent et
• les éventuels liens familiaux entre l’enfant et les grands-parents

Malgré l’évolution du droit, les tribunaux continuent souvent à privilégier le droit d’accès des parents par rapport à ceux des grands-parents. Cela dit, en plus d’analyser la relation des grands-parents avec l’enfant, les tribunaux regarderont aussi si les parents ont décidé de nier l’accès aux grands-parents de manière arbitraire. Pour que leurs droits d’accès ne soient pas réduits ou supprimés, les grands-parents doivent éviter de commettre les trois erreurs suivantes.

1. Les grands-parents ne doivent pas remplacer le rôle des parents

En aucun cas les grands-parents doivent usurper le rôle du parent. Même si les parents souffrent de difficultés financières, psychologiques ou émotionnelles, le rôle des grands-parents n’est jamais de venir prendre la place des parents pour éduquer et élever les enfants. Bien sûr, les grands-parents sont toujours bienvenus pour assister dans le développement de leurs petits-enfants. Cependant, l’intervention des grands-parents dans la vie des petits-enfants doit être limitée et doit être approuvée par les parents.

Imposer un régime alimentaire ou une religion quelconque à l’enfant ou encore, inscrire un enfant à une activité ou un établissement scolaire spécifique sans consulter les parents sont des exemples de comportement qui seront réprimandés par les tribunaux judiciaires.

2. Les grands-parents ne doivent pas adopter une attitude hostile envers les parents

Bien que la législation ontarienne prévoie que les tribunaux doivent prendre en considération les droits des grands-parents lorsque ceux-ci présentent une demande d’accès aux petits-enfants, le droit d’accès aux petits-enfants n’est jamais automatique. Ainsi, il est important pour les grands-parents de garder une conduite qui est raisonnable envers les deux parents, notamment si les deux parents se séparent.

Parfois, des tensions peuvent se bâtir entre les grands-parents et le parent qui a la garde des petits-enfants, surtout si ce parent n’est pas leur enfant. Lorsque les grands-parents adoptent une attitude hostile envers le parent qui a la garde de l’enfant, ils réduisent leurs chances d’avoir gain de cause en cour. Souvent, les tribunaux préfèreront éviter de mettre de l’huile sur le feu en obligeant le parent en question d’autoriser l’accès de l’enfant aux grands-parents.

3. Les grands-parents ne doivent pas ignorer les petits-enfants

Pour maximiser le temps d’accès avec leurs petits-enfants, les grands-parents doivent s’assurer de bâtir une bonne relation avec l’enfant dès sa naissance. Dans les cas où l’enfant ne connaît presque pas ses grands-parents, un tribunal pourrait décider qu’il n’est pas forcément dans le meilleur intérêt de l’enfant de donner des droits d’accès aux grands-parents.

Il incombe aux grands-parents bâtir une relation positive avec l’enfant et ses parents. Visiter l’enfant de temps à autre est insuffisant pour créer ce type de relation. Les grands-parents doivent créer des liens affectifs réels et participer de manière très active dans la vie de leurs petits-enfants. De façon générale, les tribunaux sont prêts à accorder des droits d’accès aux grands-parents lorsque l’enfant a vécu chez eux ou lorsqu’il a passé une période considérable avec eux peu de temps avant les procédures judiciaires.

Avant de présenter une requête devant les tribunaux, il peut être judicieux de retenir les services d’un avocat pour connaître ses droits et ses obligations par rapport aux petits-enfants.

Karen Kernisant est avocate à Aubry Campbell MacLean et pratique dans le domaine du droit de la famille, du contentieux civil et du droit criminel.

Canadian Taxes A to Z (2018): "U" is for UCC, "V" is for V-Day, "W" is for Withholding Tax, "X" is for X-Mark, "Y" is for Year End, "Z" is for ZBB

Today is the last in the series of Canadian Taxes A to Z (2018) posts. Yes, I know you're sad. I'm sad too. But at least you can look forward to receiving that big tax refund generated through your newfound interest in Canadian tax law!

I'm combing the last six letters of the alphabet into one post, rather than stretching them out into six separate posts, because we're down to the wire for filing deadlines. So I hope you'll forgive me for the combination of the last six tricky letters of the alphabet. 

If you run into trouble with the CRA out of the 2017 taxation year, I urge you first to consult a designated accountant or tax planning lawyer. You may need to file an objection, or seek other relief; you'll be subject to strict time deadlines in doing so. 

If you still can't sort things out, and need to go to the Tax Court of Canada or the Federal Court after exhausting the CRA's internal remedies, given me a call, or drop me a line. 

UCC STANDS FOR MORE THAN UNIFORM COMMERCIAL CODE

"U" is for for Undepreciated Capital Cost (UCC). It's very important to keep track year to year of your UCC for each capital asset (within each class) that you own. It's not enough to simply know how much you paid for the capital item, and what percentage of depreciation can be claimed each year, since each year the depreciation claimed will be a slightly smaller figure (the same percentage of a lower number), whereas in the first year the depreciation claimed will be a much small number (half the normal depreciation rate) because of the half year rule. Keep all your UCC receipts organized by class, and year of acquisition. 

"V" ISN'T JUST FOR VICTORY

"V" is V-Day. No, not Victory Day. Not Victoria Day. Definitely not Valentines Day. V-Day stands for Valuation Day in tax speak. V-Day is any day when you needed to determine a fixed financial value for something that you'd owned for a while, and planned to own for a while longer, but which didn't have a readily apparent value (like a share price). 

For example, if you bought a commercial property back in the 1960's prior to capital gains being taxable, and then planned to sell it now, you'd need to establish a value for it as of the end of 1971 after which capital gains became taxable. There could be other tax reasons for a V-Day, like making a particular election under the Income Tax Act. In any case, you may need to later defend your V-Day value if challenged by the CRA, so ideally you'll employ a professional to establish a fair market value.

ENSURE YOU WITHHOLD TAX WHEN REQUIRED

"W" is for Withholding Tax. Canadian law stipulates many situations where a payor of money is required to withhold a certain percentage of that money, and instead of paying it over to the person to whom it is owed, must remit it to the government for estimated taxes owning. The most common type of tax withholding is that of employers who are required to withhold a percentage of employee wages as income taxes, with the percentage of withholding rising with the level of the employee's wages. Other kinds of common withholding taxes are those required by financial institutions on RRSP withdrawals, and those required on foreign residents for Canadian income. 

At tax filing time, the government may determine that there was too much or too little withholding, leading to a refund or additional taxes owing. The trick to navigating withholding rules is to try to bring yourself within the conditions where no withholding is required, or to keep the payments you receive below the threshold where a higher level of withholding is triggered. 

X MARKS THE SPOT

"X" is for ... well ... er ... I don't know what X is for. I've look in the Income Tax Act. I've studied accounting term glossaries. And none are big on the letter X.

Perhaps Taxgirl (who gave me the inspiration for all these Canadian taxes A to Z posts) can help out? Her X word is sometimes the name of an IRS form which doesn't really help in the Canadian context. In other years she cited financial terms involving X, but I like her 2012 post the most: X is for X-Mark (Signature): http://www.forbes.com/sites/kellyphillipserb/2012/03/28/taxes-from-a-to-z-x-is-for-x-mark-signature/. 

Taxgirl quite rightly points out that a tax return in the U.S., just like a return in Canada, isn't valid unless it's signed! It's easy to forget that last step, after putting in all the up front work on the numbers. Electronic returns also need to be "signed," but there are deeming rules that you signed it if you submitted it in the correct way through the electronic portal. 

BEWARE OFF-CALENDAR YEAR ENDS

"Y" is for Year End. Many organizations (including corporations) have off-calendar fiscal years. Often, the timing of the year-end is to coincide with a time of the year when business is slow and employees are not on holiday, and thus there are more resources available to close the year-end books. Tax consequences of having a non-calendar fiscal year can be to shift some income to a future taxation year, and thus defer tax. 

However, unincorporated individuals operating as sole-proprietors or partners can generally no longer benefit from a permanent income/taxation shift. While they might initially defer some tax in the first year of business, that tends to get picked up in the second year of business (possibly pushing the businessperson into a higher tax bracket by capturing more than 12 months of income). Definitely get professional accounting advice prior to deciding to go with a Year End other than December 31.

ZERO BASED BUDGETING LOOKED SO GOOD ON PAPER

"Z" is for Zero Based Budgeting (ZBB). Yes, not really a tax term. But like the letter X, there aren't a whole lot of Z tax terms. And zero based budgeting could ultimately affect your tax situation by increasing (or decreasing) your net revenues.

The concept was first deployed on a large scale by the Texas Instruments corporation in the 1960's in the private sector, and later championed in the public sector by Jimmy Carter (prior to his becoming U.S. president). 

It's another of those looks great on paper, not so easy to practically implement concepts. For any business (or government), the theory goes that instead of a new fiscal year's budget starting with the previous year's budget as a base (and thus being prone to incremental budget creep), each year should start with zero, with every line item being required to be justified all over again year after year. The theory is that ZBB is a great way to eliminate waste. If you can't justify why you've got a budget line, then "poof" you're eliminated. 

The problem with ZBB is that rebuilding a budget every year from the ground up can become an overwhelming, all consuming task. And valuable parts of an organization with less tangible outputs could get snuffed out, to the detriment of the entire organization. 

Gordon S. Campbell practices Federal and Ontario court litigation and dispute resolution, including tax, immigration & citizenship, business, property, criminal, family, professional conduct, and farm law. Learn more at www.acmlawfirm.ca/gordonscottcampbell

Canadian Taxes A to Z (2018): "T" is for Terminal Loss

In today's Canadian Taxes A to Z, T is for Terminal Loss. Twenty letters down, six to go. And yes, I'm aware there's only one day left!

For some reason, I've always liked the term Terminal Loss. Maybe because it conjures up travel images of train and bus terminals. Perhaps because of its finality. It's another of those "tax terms" that if you're not in the know, you'd never guess at what it means.

SELLING FOR LESS THAN UCC GENERATES A TERMINAL LOSS

When depreciable capital property is sold for a value lower than its undepreciated capital cost (UCC) at the end of a fiscal year, then it can general a terminal loss if there are no other assets left in the class. A terminal loss is fully deductible against other income.

Say you buy a Big Purple Machine, take some depreciation over a couple of years that reduces its UCC to $10,000, but then sell it for only $5,000. Perhaps because Big Purple Machines were an industry fad for a couple of years, but ultimately didn't make anyone any money. Thus the low resale value.

If nothing is left in the Big Purple Machine class, you can claim another $5,000 terminal loss deduction for the difference between the UCC and what you sold it for. Pretty good, eh?

BEWARE RECAPTURE INSTEAD OF TERMINAL LOSS

But watch out. Terminal Loss has an evil twin called Recapture. If you sell the Big Purple Machine for $11,000, but have already depreciated it to a $10,000 value, and nothing is left in the class, then you wind up with a $1,000 recapture that you've got to include in income!

The moral of the story is try to sell used business assets for amounts lower than the depreciation you've taken on them. You'll be able to deduct any loss you take, and won't wind up getting stuck with paying taxes on any sale profit.

Gordon S. Campbell has argued tax cases as high as the Supreme Court of Canada. He also litigates civil, criminal and family law cases in Ontario & Federal courts, as well as practicing immigration & citizenship law. Learn more at www.acmlawfirm.ca/gordonscottcampbell