TaxonTax Advisory

Event 5: The on-reserve business the CRA taxed anyway, until the Court stepped
in

A status Indian ran a brush-clearing business from his home on the Fort Nelson Indian Reserve, working for oil and gas companies. The CRA taxed his business income. He appealed.

In 2012, the Tax Court sided with him. Looking at all the connecting factors, where he lived, where the business was based, where the work was organized from, the Court found the income was situated on reserve and exempt under section 87 of the Indian Act.

For my Indigenous clients, the honest version of this story has two halves. The exemption is real, and it wins in court when the facts genuinely connect the income to the reserve. But the courts read those connecting factors carefully, and arrangements built only on paper have repeatedly failed.

Where your business is based, where the work happens, where decisions get made: these details decide the tax outcome. That's true for every business, and doubly true where section 87 may apply.

If your income touches reserve land and nobody has ever walked through the connecting factors with you, that conversation is overdue. It can change everything.

Real cases from the Tax Court of Canada. General information, not advice for your situation.
TaxOnTax Advisory Ltd. | Edmonton, Alberta | taxontax.com

Event 4: Two investors, two very different endings

A B.C. investment advisor grew his TFSA from $15,000 to over $600,000 by rapidly trading penny stocks. The CRA said that much trading isn't saving, it's running a business, and business income is taxable even inside a TFSA. In 2023, the Tax Court agreed.

Meanwhile, in 2026, an investor claimed credits for the foreign tax withheld on her overseas dividends. The CRA denied them. She won her appeal, because her account statements were clean enough that the judge could recalculate every dollar from scratch.

One investor's account became a tax bill. The other's records became a victory.

For my semi-retired clients especially, this is Event 4 in a nutshell: the tax system cares how you invest and how you document it, not just what you earn. Which investments sit in the TFSA, which in the RRSP, which in the open account. How actively you trade. Whether your paper trail can answer questions years later.

When did someone last review your portfolio through a tax lens instead of just a returns lens?

Real cases from the Tax Court of Canada. General information, not advice for your situation.
TaxOnTax Advisory Ltd. | Edmonton, Alberta | taxontax.com

Event 3: Retired doesn't mean finished with the CRA

A retired federal public servant, almost thirty years of service, ended up in Tax Court over a deduction connected to how her employment ended. She represented herself. In 2015, she won.

What made the difference? Her paperwork. Years after retirement, she could still show what happened, when, and why.

Retirement changes your relationship with the tax system, but it doesn't end it. Pension income. RRIF withdrawals. The credits that begin at 65. The decisions that echo for decades: when to start CPP and OAS, which account to draw down first, how to split pension income with your spouse.

The withdrawal order alone can change a retirement's lifetime tax bill by tens of thousands of dollars. Same savings. Different sequence. Very different result. And the decisions cluster in a narrow window around the retirement date.

If you or your parents are within five years of retiring, that's the planning window. It closes quietly, one election at a time.

Real cases from the Tax Court of Canada. General information, not advice for your situation.
TaxOnTax Advisory Ltd. | Edmonton, Alberta | taxontax.com

Event 2: The Edmonton woman who fought for her tuition and won

An Edmonton woman went back to school mid-career, an online MBA through a U.S. university, while keeping her life running here at home. When she claimed her tuition and education credits, the CRA denied them.

She appealed to the Tax Court. In 2011, she won. The Court confirmed her online program qualified, and the credits stood.

Mid-career retraining is one of the biggest financial moves people make, and one of the least planned. Tuition credits. RRSP room. The timing of a low-income year, which can be the perfect year for certain moves. A year of school changes your whole tax picture, usually in our favour, if someone is paying attention.

And a caution from the same court, in 2026: a taxpayer who pulled money from her TFSA and put it back the same calendar year got hit with a monthly overcontribution tax. The room doesn't come back until January 1. Small rule, exact edge.

Planning a return to school, a first home, or any big move this year? The tax plan belongs beside the budget, not after it.

Real cases from the Tax Court of Canada. General information, not advice for your situation.
TaxOnTax Advisory Ltd. | Edmonton, Alberta | taxontax.com

Event 1: The medical expenses the CRA said didn't count

A retired couple paid for regular acupuncture treatments. When they claimed the cost as a medical expense credit, the CRA denied it, because the person providing the treatments wasn't a licensed medical practitioner.

The taxpayer took it to the Tax Court himself, no lawyer, and in 2012 he won. The Court looked at how the provincial rules treated acupuncture at the time and let the credit stand.

Here's why this story matters to so many people. If you're managing a serious illness, caring for a spouse, or supporting an aging parent, the medical expense credit is real money. Travel for treatment. Attendant care. Home modifications. Some claims are allowed, some aren't, and the line moves depending on the year and the province.

Most families claim far less than they're entitled to, because nobody ever sits down and goes through eighteen months of receipts with the rules open.

If your household had a hard health year, don't guess at what counts. Ask. The answer is often better than you expect.

Real cases from the Tax Court of Canada. General information, not advice for your situation.
TaxOnTax Advisory Ltd. | Edmonton, Alberta | taxontax.com

Here's one that catches business owners off guard more than almost anything else I see.

Shareholder benefits.

If you own a corporation, the company paying for things that are really personal, or you taking money or assets out the wrong way, can end up as taxable income on your personal return. Even if you never wrote yourself a cheque. Even if you didn't realize it happened.

The company car used mostly for personal driving. Personal expenses run through the business. An interest-free loan from your own corporation that sits there too long. Money pulled out that never got recorded as salary or a dividend. CRA can look at any of these and say, that's a benefit to you, and now it's taxable in your hands.

The part that stings is the timing. A lot of the time nobody catches it in the moment. It gets flagged years later in a review or an audit, and by then you're looking at back taxes, interest, and sometimes penalties on top.

None of this means you can't take money out of your own company. Of course you can. It just has to be done the right way, and recorded the right way, so it doesn't come back to bite you.

If you own a corporation and you're not completely sure everything's being handled cleanly, that's worth a look before CRA takes their look.

Derik Godbout, PBA, CEA
taxontax.com

Your farm was worth more at the end of last year. Your plan was exactly the same.

Alberta farmland went up 11.4 per cent in 2025. Alberta and Saskatchewan together accounted for more than three quarters of the entire national gain in farm equity.

Here is the part that doesn't make the headline. Operating expenses were up. Livestock purchases had their biggest jump since 1981. Realized net farm income across the country stayed flat, well below where it sat two years ago.

So the land is worth more, the cattle are worth more, and there is no more money in the account than there was.

That is what makes a farm hard to hand down. The tax bill on the way out is calculated on what the place is worth. The money to pay it comes from what the place earns. When those two move apart far enough, families sell land to settle an estate.

It is fixable. It is a great deal easier to fix five years early than five months late.

Derik Godbout, TaxOnTax Advisory Ltd., Edmonton. Farm succession, estate freezes, section 85 rollovers, executor advisory. Discovery Meeting is $150 - Start today!

825-977-7999 | taxontax.com

Some of the hardest situations I see in this work could have been avoided with one conversation.

A parent has a stroke, or slips into dementia, and suddenly nobody knows what they wanted. Where the important papers are. Who's supposed to make the decisions. Whether there's a power of attorney, and where to find it. The family is grieving and scrambling at the same time, and often they end up guessing.

It doesn't have to go that way.

The families who handle this well are the ones who talked about it early, while everyone was healthy and clear-headed. Not a morbid conversation. Just an honest one.

A few things worth sitting down and covering while you still can:

Who holds power of attorney, for both finances and health, and where that document lives. Where the will is, and who the executor is. What accounts, insurance, and property exist, and how to find them. And most importantly, what actually matters to the person. What they'd want, and what they wouldn't.

None of this is really about paperwork. It's about not leaving the people you love to guess during the worst week of their lives.

If you're not sure where your family stands on any of this, that's worth a conversation. It's a big part of what I help families work through.

Derik Godbout, PBA, CEA