Excise Tax Act

Marginal note:Definitions

• 274 (1) In this section,

  tax benefit

  tax benefit means a reduction, an avoidance or a deferral of tax or other amount payable under this Part or an increase in a refund or rebate of tax or other amount under this Part; (avantage fiscal)

  tax consequences

  tax consequences to a person means the amount of tax, net tax, input tax credit, rebate or other amount payable by, or refundable to, the person under this Part, or any other amount that is relevant to the purposes of computing that amount; (attribut fiscal)

  transaction

  transaction includes an arrangement or event. (opération)

• Marginal note:General anti-avoidance provision

  (2) Where a transaction is an avoidance transaction, the tax consequences to a person shall be determined as is reasonable in the circumstances in order to deny a tax benefit that, but for this section, would result, directly or indirectly, from that transaction or from a series of transactions that include that transaction.

• Marginal note:Avoidance transaction

  (3) An avoidance transaction means any transaction

  • (a) that, but for this section, would result, directly or indirectly, in a tax benefit, unless the transaction may reasonably be considered to have been undertaken or arranged primarily for bona fide purposes other than to obtain the tax benefit; or

  • (b) that is part of a series of transactions, which series, but for this section, would result directly or indirectly in a tax benefit, unless the transaction may reasonably be considered to have been undertaken or arranged primarily for bona fide purposes other than to obtain the tax benefit.

• Marginal note:Provision not applicable

  (4) For greater certainty, subsection (2) does not apply in respect of a transaction where it may reasonably be considered that the transaction would not result, directly or indirectly, in a misuse of the provisions of this Part or in an abuse having regard to the provisions of this Part (other than this section) read as a whole.

• Marginal note:Determination of tax consequences

  (5) Without restricting the generality of subsection (2),

  • (a) any input tax credit or any deduction in computing tax or net tax payable may be allowed or disallowed, in whole or in part,

  • (b) any such credit or deduction or a part thereof may be allocated to any person,

  • (c) the nature of any payment or other amount may be recharacterized, and

  • (d) the tax effects that would otherwise result from the application of other provisions of this Part may be ignored,

  in determining the tax consequences to a person as is reasonable in the circumstances in order to deny a tax benefit that would, but for this section, result, directly or indirectly, from an avoidance transaction.

• Marginal note:Request for adjustments

  (6) If, with respect to a transaction, a notice of assessment, reassessment or additional assessment involving the application of subsection (2) with respect to the transaction has been sent to a person, any person (other than a person to whom such a notice has been sent) is entitled, within 180 days after the day of sending of the notice, to request in writing that the Minister make an assessment, a reassessment or an additional assessment, applying subsection (2) with respect to that transaction.

• Marginal note:Exception

  (7) Notwithstanding any other provision of this Part, the tax consequences to any person following the application of this section shall only be determined through a notice of assessment, reassessment or additional assessment involving the application of this section.

• Marginal note:Duties of Minister

  (8) On receipt of a request by a person under subsection (6), the Minister shall, with all due dispatch, consider the request and, notwithstanding subsections 298(1) and (2), assess, reassess or make an additional assessment with respect to the person, except that an assessment, a reassessment or an additional assessment may be made under this subsection only to the extent that it may reasonably be regarded as relating to the transaction referred to in subsection (6).