The applicant (Lobsinger) stated:

• on June 16, 2017 the trustees of the Lobsinger Family Trust resolved that the trust property and all interests in it would vest equally among the three beneficiaries of the trust (who were Lobsinger’s children) before the trust's 21st anniversary on October 31, 2017;
• subsequently, on October 10, 2017, a majority of the trustees confirmed that the vesting would take effect on October 15, 2017; and
• Lobsinger then instructed counsel to prepare documentation to evidence this decision - but it was not prepared until after CRA commenced its audit, in 2019.

CRA reassessed on the basis that the trust realized a gain on its 21st anniversary. An appeal to the Tax Court had been held in abeyance to allow Lobsinger to bring this application: he sought a declaration that the trust property and all interests in the trust property vested indefeasibly on October 15, 2017 and, alternatively, sought an order vesting the trust property and all interests in it equally among the beneficiaries of the trust, nunc pro tunc, as of October 15, 2017.

In declining to exercise jurisdiction over this application, Brookes J stated:

Where a provincial Superior Court has concurrent jurisdiction with the Tax Court, it should exercise that jurisdiction only over issues that are ancillary, rather than fundamental, to the tax proceeding … .

The issue of whether the Trust property vested indefeasibly on October 15, 2017, is neither subordinate nor incidental to the reassessment. It is the central issue in the ongoing Tax Court appeal.

Neal Armstrong. Summary of Lobsinger v Lobsinger Family Trust, 2026 ABKB 671 under ITA s. 171.

This morning's release of four severed letters from the Income Tax Rulings Directorate is now available for your viewing.

The Benoît Trottier Family Trust realized a capital gain of $950,000 in 2014, which was eligible for the enhanced capital gains exemption. The trust purported to distribute funds equal to that capital gain on December 29, 2014 to two beneficiaries (the wife and mother of Mr. Trottier). The ARQ denied the deduction claimed by the trust under the Quebec equivalent of ITA s. 104(6) and added $950,000 to Mr. Trottier's income pursuant to the Quebec equivalent of s. 105(2). In confirming these assessments and finding that the purported distribution was a sham as Mr. Trottier retained control of the funds at all times and, several months later, used them to acquire securities in his brokerage account, Riverin JCQ stated:

Here, there was no actual distribution, as the beneficiaries did not receive the amounts and had no control over them. Mr. Trottier did not relinquish these amounts. In reality, the "beneficiaries" did not derive any easily realizable economic value from them.

The preponderant evidence demonstrates that Mr. Trottier and the Trust claimed to distribute an amount of $950,000 to Ms. Perrault and Ms. Sauvageau, but this was not the case. This transaction was designed and carried out to disguise the reality and deceive the tax authorities, as Mr. Trottier retained control over this amount.

Neal Armstrong. Summary of Trottier v. Agence du revenu du Québec, 2026 QCCQ 4372 under s. 104(24).

DAC found that the continuance outside Canada of a Canadian-controlled private corporation before realizing a capital gain (thereby avoiding the additional tax imposed on CCPC investment income) was abusive because it frustrated the anti-deferral objective of the CCPC regime as inferred from a broadly stated equivalence principle drawn from the 1971 budget speech of Edgar Benson, that the taxation of investment income should be the same whether received directly or through a private corporation. However, it is suggested that:

A general statement drawn from a budget speech, standing alone and untested against the subsequent legislative record, cannot discharge [the] obligation … [for] genuine engagement with the text of the relevant provisions, the structure of the legislative scheme of which they form part, and the legislative history that illuminates Parliament's choices over time.

Parliament repealed the personal corporation rules (which, by taxing domestic controlled corporations on a full look-through basis, came closest to achieving the Benson assertion) at the very moment he articulated that principle, and then enacted a refundable tax mechanism that was deliberately confined to a narrowing subset of corporations, so that resident non-Canadian corporations (RNCCs) were excluded entirely. Furthermore, as part of a policy of the preferential treatment of Canadian corporations as defined, Parliament removed the dividend tax credit entitlement on dividends paid by a resident non-Canadian corporation – and later, restricted RDTOH entitlements to CCPCs rather than all private corporations, so that an RNCC was not entitled to either a DTC or RDTOH. Furthermore, the general rate reduction in 2000 did not exclude an RNCC from accessing the reduced rate for investment income.

Thus, DAC identified Parliamentary intention at a level of abstraction that the legislative history of the integration regime and the s. 123.3 anti-deferral regime does not support and that the Canada Trustco, Copthorne and Deans Knight trilogy (which took a bottom-up approach grounded in the specific statutory mechanisms whose purposes was said to be frustrated - rather than effecting a top-down application of a statement of generalized intent) also does not support.

Neal Armstrong. Summary of Mark Brender, “The meaning of ‘clear abuse’ in GAAR jurisprudence, Corporate Structures and Groups (Federated Press), Vol. 22, No. 4, 2026, p. 3 under s. 245(4).