2026 Tax Planning Update: GAAR, Disclosure Rules, Privilege and Recent Court Decisions

Tax planning in Canada has never been more challenging. Enhanced GAAR penalties, the reportable and notifiable transaction rules, expanding CRA audit powers and ever-widening reporting obligations all affect how practitioners plan and document transactions. In this interactive panel, tax and estates lawyers work through the issues most relevant to practice today, combining recent case law with practical takeaways and live audience questions.

The session opens with the current planning environment: the chilling effect of the enhanced GAAR, how reporting under the mandatory disclosure rules can interact with voluntary GAAR disclosure, and a recent Federal Court of Appeal decision that emphasizes the text of the Act when interpreting it. It then covers a key Federal Court of Appeal decision on dividends paid through a family trust to a corporate beneficiary, why the timing can trigger Part IV tax in pre-sale planning (the Supreme Court of Canada has declined to hear an appeal), and how to plan around it, including the impact on capital dividend account planning.

The panel then looks at whether a surviving spouse can be held liable for a deceased spouse’s tax debt under section 160, and what that means for RRSP beneficiary designations and clearance certificates. It covers fixing past transactions and compliance errors: when doing nothing is an option, the revised Voluntary Disclosure Program, memorializing undocumented agreements, and why backdating can lead to gross negligence and third-party penalties.

Further topics include solicitor-client privilege in tax planning (including why there is no accountant-client privilege, and how AI note-takers can waive privilege), lesser-known dispute options such as judicial review, remission orders and the Tax Court’s informal procedure, and the newly enacted changes to the section 44.1 capital gains deferral for small business shares. The session ends with a lightning round on 21-year rollouts from trusts, price adjustment clauses and reassessment periods, and common pitfalls in passing assets to the next generation.

Topics Covered

• The current planning environment: enhanced GAAR, mandatory disclosure rules, and expanding CRA audit powers
• Textual interpretation of the Income Tax Act in recent case law
• Reporting under the reportable and notifiable transaction rules versus voluntary GAAR disclosure
• Dividends designated through a trust to a corporate beneficiary: connected corporations and Part IV tax
• Planning around the corporate beneficiary decision, including capital dividend account timing
• Section 160 liability for a surviving spouse, and RRSP beneficiary designations
• Clearance certificates and executor liability
• Fixing past transactions and compliance errors
• The revised Voluntary Disclosure Program: prompted and unprompted disclosures
• Memorializing verbal agreements, and the risks of backdating
• Solicitor-client privilege, engagement structures, and protecting planning memos
• Why there is no accountant-client privilege, and the privilege risks of AI note-takers
• Dispute options: judicial review in the Federal Court, remission orders, and the Tax Court’s informal procedure
• Section 44.1 capital gains deferral for small business shares: the 2026 changes
• Trusts approaching the 21-year deemed disposition, and rollout restrictions
• Price adjustment clauses and the normal reassessment period
• Joint tenancy, resulting trusts, probate planning, and naming beneficiaries