Words and Phrases - "Crown agency"
15 September 2003 External T.I. 2003-0034195 F - ALLOCATION DE RETRAITE
The taxpayer had worked in a succession of teaching positions. Regarding whether past employers were related to the current employer for purposes of s. 60(j.1), CCRA stated:
Whether educational institutions (e.g., a high school, CEGEP or university) can be considered related is a question of fact that can only be determined after an examination of each particular case. In these cases, it must be determined whether there is any governmental control that would cause them to be considered an agent of the government. A particular entity will be an agent of the Crown if the statute creating that entity expressly makes it an agent of the Crown or if, under customary law, the entity is an agent of the Crown. To this end, the courts have established the functions and control test. For example, one must consider the nature of the functions performed by the public body, i.e. the extent of state and governmental functions, and one must assess the nature and degree of control exercised by the government over the body. For this purpose, the word "control" does not mean the ownership of 50% or more of the voting shares of the entity but rather the control of operations which is comparable to the kind of control exercised by the board of directors of a commercial enterprise. This determination requires, inter alia, a review of the organization’s governing statute or other documents that define the status of the organization in relation to the government. It should be noted, however, that the fact that the entities in question contribute to the same pension plan is not a sufficient criterion for finding a relationship between two employers. Unless otherwise indicated, we are of the view that a school board is not related to a university.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 60 - Paragraph 60(j.1) | employee purchase of back years of service with a related employer permitted | 64 |
Laval Technopole v. Agence du revenu du Québec, 2018 QCCQ 6352
The various appellants were companies that promoted commercial development, or cultural, sporting or tourist activities, in their respective municipalities. They were subject to a lower rate of Quebec health tax premiums if they constituted an employer with an establishment in Quebec provided that they were not an agent (“organisme mandataire”) of a Canadian municipality. They were not specifically designated in their letters patent as agents of their respective municipalities.
In finding that the appellants were such agents, Quenneville JCQ first referred to the common law function and control tests for determining crown agency (referencing “the nature and degree of control that the Crown exercises over the entity” (para. 58) ), and then stated (at paras. 165-168, TaxInterpretations translation):
To begin with, the municipalities themselves, with the exception of Longueil pour Sogerive et Agapac, confirmed that they controlled the entities.
In all cases, with the exception of CLLS, the majority of the members of their boards were named by the municipality or chosen from among a list proposed by the latter. In the case of CLLS, only two members of six of the board were named by the municipality, but it was it that named the president and vice-president.
It is important to emphasize that it is not actual control which must be considered, but rather the potential for the municipality to exercise such control. ...
The Councils of all the municipalities approved the financial statements, the budgets and the expenses of the entities. It was also the municipalities that financed a very large portion of the appellants’ activities. Furthermore, in all instances, their activities were integrated with those of the municipalities.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - General Concepts - Agency | 192 | |
| Tax Topics - Income Tax Act - Section 149 - Subsection 149(1) - Paragraph 149(1)(c) | municipally influenced companies were agents of the municipality | 82 |
Omers Realty Corporation v. Ontario (Finance), 2012 ONCA 400
In affirming the finding below that the Ontario Municipal Employees Retirement System (“OMERS”) Board and two of its subsidiaries, which invested in commercial real estate, were Crown agencies, the Court stated (at paras. 4-5, 7):
The motion judge correctly focussed on the Government’s de jure control of the OMERS Board and, in our view, correctly concluded that “at the material time, the OMERS Board was a Crown agency.”
On the second issue [respecting the subsidiaries], ...the motion judge [correctly] concluded:
[T]he statutory scheme exempts Crown agencies, in this case the OMERS Board, from having to pay land transfer tax. The scheme recognized that the OMERS Board could act through subsidiaries and allowed for subsidiaries that held real estate to be wholly-owned. It would be inconsistent with the scheme to find that these subsidiaries were not Crown agencies and, thus, remove the benefit to which the OMERS Board would otherwise be entitled. ...
In addition, when the Government decided to change its policy in this domain, it did so by enacting a law that expressly provided that OMERS was no longer a Crown agency... .