Cabinet M - Court of Quebec infers that a payment made by the taxpayer to his corporation was made as an advance, so that s. 160 did not apply

In August and September 2016, the taxpayer transferred $35,000 from his bank account to that of his corporation. On September 30, 2016, $75,000 was transferred from the corporate account to his personal account.

Messier JCQ found that an obligation of the corporation to repay the $35,000 advance arose from the moment it was made. Therefore, it should not be considered that, for purposes of the Quebec equivalent of s. 160, the taxpayer had made the $35,000 payment to his corporation for no consideration, so that that provision did not apply.

Neal Armstrong. Summary of Cabinet M Inc. v. Agence du revenu du Québec, 2026 QCCQ 2159 under s. 160(1).