Relationships

Question 1

Arm’s length

Answer 1

ss.251(1) defines “Arm’s length” for purposes of the Act:
a. Related persons deemed not to deal at arm’s length;
b. A taxpayer and a personal trust will be deemed not to deal with each other at arm’s length
if the taxpayer, or any person not dealing at arm’s length with the taxpayer, is beneficially
interested in the trust;
c. Question of fact whether unrelated persons are at a particular time dealing at arm’s length
• decision making criteria applied by the courts:
‒ Common mind?
‒ Acting in concert?
‒ De facto control?