6 Foreign Affiliate Tax Planning tax and accounting engagements in full — what the client came to us with, what we did, and what it was worth. Each one is specific to foreign affiliate tax planning work, not a general example.
Case Study 1 · Structure rebuilt
Holding Structure Added, $72,000 Saved Annually — Emigrant Who Left Canada, Red Deer
Client: An emigrant who left Canada mid-year · Where: Red Deer, Alberta · Engagement: 4 weeks, fixed fee
Annual saving$72,000
ReorganisationTax-neutral
StructureMatches operations
The situation
An emigrant who left Canada mid-year in Red Deer, Alberta was carrying 25% withholding on gross Canadian rent where a section 216 election would have taxed only the net, and every option for fixing it ran through a reorganisation that had to be done without triggering tax.
What we did
Working with the client's lawyer, we filed the section 216 election with the supporting rental statements and recovered the excess withholding as a refund and prepared the elections, resolutions and valuations the structure needed to stand up.
The result
The structure now matches the business. Annual saving of $72,000, and the reorganisation itself was tax-neutral.
Case Study 2 · Backlog brought current
$13,000 Of Arbitrary Assessments Vacated After 3 Years — Inbound Transferee on Assignment, Barrie
Client: An inbound transferee on assignment · Where: Barrie, Ontario · Engagement: 3 weeks, fixed fee
Arbitrary tax vacated$13,000
Years brought current3
Account statusCurrent
The situation
3 years of unfiled returns had turned into notional assessments at an inbound transferee on assignment in Barrie, Ontario, with foreign accounts that had passed the $100,000 T1135 threshold three years earlier underneath. Collections had already started.
What we did
We filed the outstanding T1135 disclosures through the Voluntary Disclosures Program, which eliminated the penalty exposure entirely, then filed every outstanding year in chronological order so the CRA could vacate the notional assessments cleanly.
The result
All 3 years were accepted as filed. $13,000 of arbitrarily assessed tax was vacated, collections action stopped, and the account is current for the first time in 3 years.
Case Study 3 · Sale and succession
$760,000 Sheltered By The Lifetime Capital Gains Exemption — Canadian Resident with a, Toronto
Client: A Canadian resident with a US rental property · Where: Toronto, Ontario · Engagement: 10 weeks, fixed fee
Gain sheltered$760,000
ClosingOn schedule
Share qualificationMet
The situation
A Canadian resident with a US rental property in Toronto, Ontario had an offer on the table and 10 months to close. The shares did not qualify for the capital gains exemption, and a shareholder loan balance that would have been picked up as income on closing was part of the reason.
What we did
We purified the corporation so the shares met the qualifying tests, then reported the deemed disposition properly on the departure return and claimed the foreign tax credits that had been left unused well ahead of the closing date.
The result
The sale closed on schedule with $760,000 sheltered by the lifetime capital gains exemption across the shareholders.
Case Study 4 · Records and systems rebuilt
Books Rebuilt From Source, $5,800 In Unclaimed Input Tax Found — Canadian Corporation with US, Edmonton
Client: A Canadian corporation with US customers · Where: Edmonton, Alberta · Engagement: 3 weeks, fixed fee
Unclaimed tax found$5,800
Records rebuilt25 months
ProcessDocumented
The situation
A Canadian corporation with US customers in Edmonton, Alberta could not answer basic questions about its own numbers, because a US LLC taxed as a corporation in Canada, producing double tax on the same income sat between the bank statements and the ledger.
What we did
We restructured the US holding so the Canadian and US characterisations aligned, ending the double taxation going forward, then documented the process so the work does not depend on any one person remembering how it was done.
The result
Records rebuilt and reconciled, $5,800 recovered in input tax credits that the old file could not support, and a documented monthly process now in place.
Case Study 5 · Deadline rescue
$96,000 Late-Filing Penalty Cancelled On Relief Application — Non-Resident Owning Canadian Rental, Surrey
Client: A non-resident owning Canadian rental property · Where: Surrey, British Columbia · Engagement: 3 weeks, fixed fee
Penalty cancelled$96,000
Relief applicationGranted
ReturnAccepted as filed
The situation
A non-resident owning Canadian rental property in Surrey, British Columbia had already missed one deadline and was about to miss a second. Behind it sat US tax paid but no foreign tax credit claimed on the Canadian return, and a penalty of $96,000 was accruing.
What we did
We split the work into what had to happen before the deadline and what could follow it, then filed the section 216 election with the supporting rental statements and recovered the excess withholding as a refund.
The result
The outstanding return was accepted as filed, and the taxpayer relief application cancelled $96,000 of the penalty already assessed on the earlier year.
Case Study 6 · Objection and relief
Desk-Review Assessment Of $74,000 Vacated — Canadian with a US, Burnaby
Client: A Canadian with a US employer · Where: Burnaby, British Columbia · Engagement: 6 weeks, fixed fee
Assessment vacated$74,000
Supporting recordsNow on file
AccountCleared
The situation
A Canadian with a US employer in Burnaby, British Columbia was carrying $74,000 of penalties and interest arising from 25% withholding on gross Canadian rent where a section 216 election would have taxed only the net, much of it accumulated during a period the CRA itself had delayed.
What we did
We filed the outstanding T1135 disclosures through the Voluntary Disclosures Program, which eliminated the penalty exposure entirely and framed the relief application on the specific grounds the CRA guidelines recognise rather than on general hardship.
The result
The assessment was vacated. $74,000 came off the account, and the documentation now on file makes the same position straightforward to defend next time.
Reviewed for the 2025 tax year by Udit Gupta, Certified Tax Accountant. Figures describe representative engagements of this type; outcomes depend on your own facts. Client names and identifying details are omitted for confidentiality.
