BLOG BUILD – Tompkins Insurance

The nuts and bolts of interest deductibility and leveraged life insurance – A primer

For a review of interest deductibility in the context of leveraged life insurance.

Trust rollout of life insurance – Confirmed in writing

The CRA’s long-standing position allowing a rollout of a life insurance policy from a trust has been confirmed in writing at the recent APFF Conference.

The quest for corporate beneficial ownership information – Where it’s at and where it’s going

Transparency of corporate beneficial ownership information is required to be publicly available for companies incorporated under the Canada Business Corporations Act. For an update on corporate beneficial ownership in Canada.

A business succession story – As told by the Tax Court

A tax case chronicles the story of a family business succession with a happy ending.

CRA Guidance on Mandatory Disclosure – Contingent fees

CRA guidance on mandatory reporting says referral fees in respect of estate freeze transactions and the acquisition of life insurance do not require mandatory reporting. Positive for mainstream non-aggressive tax planning connected to life insurance BUT.

The rundown on in-kind charitable gifts of life insurance and some recent clarifications

For considerations and rules relating to in-kind gifts of life insurance and an update on recent, specialized clarifications from the 2024 CALU CRA Roundtable and the August 12, 2024 draft legislation concerning life insurance gifts.

Technical amendment expands the time frame for post-mortem capital loss carry-back planning

We welcome the August 12, 2024 technical amendment to subsection 164(6) which extends the time frame for post-mortem capital-loss carry back planning.

Demystifying life insurance claims – How instant is “instant liquidity”?

One of the primary benefits of life insurance is its “instant liquidity”. The payment of life insurance claims can be surprisingly prompt after the claim has been submitted. For what needs to happen for it to go as smoothly as…

Legislative loose ends

For an update on enacted tax legislation and some of the loose ends we’ve been following.

Roll-over of life insurance to a child – it’s a thing!

For a primer on the ins and outs of the rollover for transfers of a life insurance policy to a child.

Post-mortem planning – Some updates

For an update on recent post-mortem planning items and a reminder that life insurance can fund tax liabilities arising in respect of owning private company shares on death.

Capital gains inclusion rate details – Thinking about the long term

The details of the capital gains inclusion rate increase are out. No big surprises. Think beyond June 25 and asses the long term impacts. Your clients might need more insurance.

The increased capital gains inclusion rate – Quantifying the hit

The proposed new capital gains inclusion rate will result in a difference of 8.56 percentage points. Is the actual impact 8.56% or is it 32%?

Alternative minimum tax – Where are we now?

Life insurance is a unique asset that has many favourable tax characteristics. In general, these characteristics are not in and of themselves a problem for AMT.

2024 Federal budget – Reflections on the increase to the capital gains inclusion rate through an insurance lens

By now you’ve read the 2024 Federal Budget summaries and digested some of the impacts. Here is what we think about the capital gains inclusion rate changes, looking through a distinctly insurance-focused lens.

Roll-out of life insurance policy from a trust – Undisturbed

Prior CRA commentary regarding the roll out to a capital beneficiary of life insurance at cost is undisturbed by recent commentary relating to the transfer of a life insurance policy as a dividend in-kind via a trust.

The new GAAR is already getting warmer

More good news from the CRA on the new GAAR. Common tax and estate planning transactions that were not GAAR-able before are not going to be GAAR-able now.

Post-mortem pipelines under the new GAAR are OK

The CRA has confirmed that it does not see post-mortem pipeline planning as a misuse or abuse under the new GAAR and will continue to issue favourable rulings. Life insurance in conjunction with post-mortem pipeline planning not only provides the…

Avoiding the 21-year rule? – Be notified

Certain tax planning to avoid the 21-year rule must be reported to the CRA and in their view, subject to GAAR. Consider using life insurance to solve for problems this planning is meant to address.

Employee Ownership Trusts – An unchartered option for sale of business in Canada

Proposed tax measures provide a framework for a new business succession planning option. Will Employee Ownership Trusts take hold in Canada as a viable sale of business option?

ABOUT THE AUTHOR:

Florence is a co-editor of the Canadian Taxation of Life Insurance, currently in its 12th edition and Editor-in-Chief of Insurance Planning, both published by Thomson Reuters. She is a member of the Canadian Tax Foundation, Society of Trust & Estate Practitioners, Estate Planning Council of Toronto, and the Conference for Advanced Life Underwriting. Florence is a frequent speaker and author at these and many other organizations.

If you wish to reach Florence, please email florence@tompkinsinsurance.com