Western University Faculty Income Tax Presentation

Western University Faculty Income Tax Presentation Presented by: Stephanie Hall Jeff Hood Diane Wood March 31, 2016 entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 1

Overview US Tax Considerations Filing Requirements & Overview of US Tax System Income Inclusions & Tax Deductions Foreign Reporting Requirements for US Citizens in Canada Expatriation Provisions Canadian Tax Considerations Residency Status For Individuals Income Inclusions & Tax Deductions Tax Credits Consulting Income and Incorporation entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 2

Overview of the US Tax System The United States taxes the following individuals on their worldwide income: US Citizens US Permanent Residents (Greencard holders) US Residents Citizens are taxed on their worldwide income even if not physically present or resident in the US Entitled to foreign tax credits for non-us source income File a 1040 Tax Return entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 4

Americans in Canada: General Filing Requirements All US citizens are required to file Form 1040 annually Form 1040 is due on April 15 th (April 18 th for 2015 tax year) but an automatic extension is granted to June 15 th for Americans who live abroad Extension does not extend the time to pay but late payment penalties are not imposed until after June 15 th US citizens are taxed on worldwide income, regardless of their country of residence Therefore US citizens living in Canada must file a Canadian return reporting their worldwide income and a US return reporting their worldwide income Potential for double tax exists, but several provisions of the Act/Code/Treaty help mitigate this exposure entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 5

Relief from Double Taxation: Foreign Earned Income Exclusion Qualified individuals may elect to exclude up to $100,800 US of foreign earned income from taxable income Reported on Form 2555 Income is reported on the return and then the exclusion is reported as a subtraction from gross income Business income can also qualify for the foreign earned income exclusion Foreign taxes paid on excluded income do not qualify for the foreign tax credit Therefore proration of taxes required entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 6

Relief from Double Taxation: Foreign Earned Income Exclusion An individual generally qualifies for the exclusion if his tax home is in a foreign country and one of the following tests are met: Bona Fide Residence Test must be a resident of the foreign country for an uninterrupted period that includes an entire tax year Physical Presence Test must be physically present in a foreign country for 330 full days during a period of 12 consecutive months entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 7

Relief from Double Taxation: Foreign Tax Credit Foreign tax credit may be claimed for foreign taxes paid on foreign source income Separate baskets for sources of income Passive Basket: generally includes interest, dividends, rents, royalties and capital gains General Limitation Basket: all other types of income Foreign taxes eligible for credit include Canadian income taxes, EI premiums and Canadian/other foreign withholding taxes paid Note that the top Canadian tax rate, for an Ontario resident is 53.53% vs. top US federal rate of 39.6% therefore the FTC usually eliminates all US tax on Canadian source income Note that Canada also allows a FTC for US taxes paid on US source income taxable in Canada entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 8

Americans in Canada: Taxation of Income Employment Income Cannot deduct RRSP RPP contributions are deductible under the new Treaty protocol Sourcing depends on where the services are performed Dividend Income Qualified vs. Ordinary dividends are taxed at different rates Dividends from Canadian corporations may qualify for the reduced rate Dividends are sourced to the country of the payer Holding Canadian mutual funds can create issues for US citizens Capital Gains Tax rate depends on whether the gain is short term or long term Sales of stock are sourced to the country of the taxpayer s residence FTC issues can arise depending on the period of time the stock was held, as well as foreign exchange entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 9

Americans in Canada: Taxation of Income Pensions Treaty provides for matching treatment of US pension plans in Canada. Therefore if a distribution from a plan is not taxable in the US, Canada will not tax the pension income either Roth IRAs are also granted Treaty benefits provided that the taxpayer does not make any contributions to the plan while resident of Canada This includes conversion from traditional IRA to Roth IRA entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 10

Taxation of Income Cont d Scholarships Amounts received as a qualified Scholarship by an individual who is a candidate for a degree at a qualified educational organization are excluded from income This does not apply to any amounts received which represent payments for teaching, research or other services as a condition for receiving the scholarship Sabbatical Leaves Expenses can be deductible on Schedule A as other itemized deductions limited to 2% of AGI Expenses must be directed related to the Sabbatical Should write a sabbatical proposal outlining the research projects you plan to pursue, establish a formal visiting arrangement with the host institution and keep good records entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 11

Consulting/Business Income Tax treatment the same if treated as business income earned personally Taxable on both the Canadian and US return Eligible for FTC Corporations Can be a CFC if a Canadian corporation or a controlled foreign affiliate if a US corporation Therefore additional filing requirements exist Can trigger additional deemed income inclusions LLC or S-Corps are not recommended since the tax treatment differs in Canada and the US Canada does not provide for the flow through of income to the shareholder Results in mismatch of income inclusion/foreign tax credits entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 12

Americans in Canada: Other Filing Requirements Registered Retirement Savings Plans (RRSP) IRS treats RRSPs the same as regular investment accounts therefore there is no deferral of income tax Income earned in RRSPs is not taxed in Canada until withdrawn from plan Canada-US Tax Treaty allows for a resident of the US to defer inclusion of income currently earned in an RRSP until such time that the income is taxed in Canada No longer required to disclose Treaty election on Form 8891 effective for 2014 onward This election cannot be made on a late filed return Must also disclose RRSP account on FinCEN 114 and Form 8938 entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 13

Americans in Canada: Other Filing Requirements Registered Education Savings Plans (RESP) Plan allows for individuals to make contributions for the future post-secondary education of beneficiaries Contributions cannot exceed $50,000 per beneficiary Earnings are not taxable in Canada until received by the beneficiaries US treats RESP account as a grantor trust Income in the account must be included on the taxpayer s US return annually Must be reported to the US on Form 3520/3520A entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 14

Americans in Canada: Other Filing Requirements Tax Free Savings Account (TFSA) Plan allows for individuals to earn investment income in Canada tax-free US treats TFSA account as a grantor trust Income in the account must be included on the taxpayer s US return annually Must be reported to the US on Form 3520/3520A entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 15

Americans in Canada: Other Filing Requirements Reporting may be required for investments in non-us entities: 5471 Information Return of US Persons with Respect to Certain Foreign Corporation Disclosure form for all US persons who have investments in certain foreign corporations (includes investments in Canadian corporations) Special reporting rules when foreign corporation is a considered a controlled foreign corporation (CFC) Potential for deemed income inclusions in the US which could result in a timing difference in income/taxes between Canada and the US Most common deemed income inclusions are for passive income and shareholder loans, as well as personal services income Form 8865 Required to report investments in certain foreign partnerships Form 8858 Required to report investments in foreign disregarded entities entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 16

Americans in Canada: Other Filing Requirements FinCEN Form 114, Report of Foreign Bank and Financial Accounts (FBAR) Separate filing from the tax return US persons who have a financial interest in or signature authority over foreign bank, securities, or other financial accounts, both business and personal, whose total value exceeds $10,000 are required to file annually Must disclose details of each account held, including the highest monthly balance of the account in the year Due date is June 30th of each year Significant penalties for failure to file can be imposed Must be electronically filed entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 17

Form 8938: Statement of Foreign Financial Assets Any individual that holds in aggregate more than $400K at the end of the year or $600K during the year (MFJ residents of Canada) in reportable financial assets must report information about these interests on their return Does not replace FBAR requirement Specified foreign assets that must be disclosed on the return include: Foreign financial accounts Foreign brokerage accounts Interests in foreign entities Foreign pensions, retirement plans, etc entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 18

Penalty Provisions: Undisclosed Foreign Financial Assets Expanded Penalty Provisions: A penalty of 40% will be imposed on the amount of understatement of gross income attributable to an undisclosed foreign financial asset Foreign Assets Include: Assets subject to the new foreign financial asset reporting requirement (form 8938) Foreign financial assets required to be reported on Forms 5471, 8858, 8865, 926 and 3520-A entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 19

Penalty Provisions: Undisclosed Foreign Financial Assets Expanded Statute of Limitations: Statute of limitations period will not commence until the time at which all information required under these reporting provisions is filed Therefore this provision applies if: Tax return is not filed Foreign information returns are not filed Foreign information returns are incomplete or inaccurate New statute provisions apply to the entire tax return not merely to foreign information that should be disclosed as part of the return entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 20

Medicare Tax on Investment Income Medicare Tax on Investment Income 3.8% tax imposed on the lesser of (a) Net investment income Interest, dividends, capital gains Royalties, rents (unless ordinary course of business) (b) Modified adjusted gross income in excess of $250,000 (joint filers) $125,000 (separate filers) Effective January 1, 2013 entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 21

Legislative Updates for 2015 Changes made to US Individual Taxpayer Identification Number issuance and deactivation procedures. Starting with 2016 tax year, FBAR form will be due April 15th of the following year but can be extended to October 15th Married same-sex partners will be recognized as married couples (can file married filing jointly) starting with the 2015 tax year (or 2014 returns submitted after June 26, 2015) Permanently extended estate and gift tax exemption (indexed each year) $5.45M for 2015 but top marginal estate tax rate increased to 40% entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 22

Americans Should Avoid Canadian Mutual Funds US considers foreign mutual fund to be a Passive Foreign Investment Company ( PFIC ) Highest tax rate on excess distribution and gains Interest charged on deemed deferred tax amount No problem if held by RRSP if election made Also be cautious if investing in Canadian Income Funds Distributions may not qualify for reduced US tax rate on dividends Return of capital for US purposes is likely different from Canadian return of capital entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 23

Expatriation Provisions Imposed on certain individuals who renounce US citizenship or relinquish a US greencard Rules involve a deemed disposition of all property held by the taxpayer at expatriation The covered expatriate is deemed to have sold nearly all his worldwide assets at FMV on the day before the expatriation and is taxed on the accrued gains above the threshold amount ($690,000 for 2015). Gain is taxed as ordinary income Covered Expatriates are those taxpayers who meet any one of the following: Average net income tax for the previous 5 years exceeds $160,000 Net worth exceeds $2M at the time of expatriation Fails to certify under penalty of perjury that he/she has met the requirements of the US tax code for the 5 preceding tax years entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 24

Canadian Tax Treatment of US Pension Plans Canadian law requires a taxpayer to include in income amounts received from a foreign retirement arrangement (FRA) Payments out of a FRA are not taxable in Canada to the extent that they would not be taxable in the other country to a resident of that country FRA definition includes an IRA Intention of FRA designation is to provide matching for Canadian residents with IRA plans Allows payments to be transferred from one IRA to another without triggering Canadian tax entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 25

Canadian Tax Treatment: Roth IRA A Roth IRA is not a FRA Therefore a Roth IRA is not treated the same way as a traditional IRA Treaty discusses the treatment of Roth IRA plans and includes Roth IRA in the definition of pension Under 3(b) of Article XVIII a Roth IRA will be treated as a pension as long as no contributions are made to the Roth IRA after December 31, 2008 while the taxpayer is resident of Canada Therefore income can accrue in the plan without being subject to US tax. Distributions are not taxable in the US; therefore they should not be taxable in Canada Contributions do not include rollover contributions from a different Roth IRA or Roth 401(k) but do include a conversion from an employer plan or traditional IRA into a Roth IRA entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 26

Roth IRA as Pension If a contribution is not made into the Roth IRA the taxpayer can elect to defer Canadian taxation with respect to the income accrued in the Roth IRA Under paragraph 1, pension income arising in one country and paid to a resident of the other country may be taxable in the other country but if the pension income would be excluded from income in the first country, income cannot be taxed in the other country Roth IRA distributions are not taxable in the US, therefore should also not be taxable in Canada entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 27

Transfer of Plans to Canada Lump-sum payments out of a IRA would be taxable in Canada (because it would be taxable in the US) Therefore US tax applies to transfers of IRA plans to Canada Eligible for contribution to a RPP or RRSP plan if derived from contributions made to the IRA by the Canadian taxpayer The transfer must be made within 60 days following the end of the year in which the payment from the IRA is received The lump sum payment is treated as income and then the taxpayer claims a deduction for the contribution of the lump sum into the RRSP entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 28

Basis of Canadian Taxation Resident of Canada Taxed on world wide income from all sources Entitled to foreign tax credits for non-canadian source income Files a T1 Individual Tax Return Non-Resident of Canada Taxed on Canadian source income Entitled to utilize provisions of Canada United States Income Tax Convention (1980) to determine Canadian income tax liability Files a T1 NR Individual Tax Return entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 30

Residency Status For Individuals 1. Deemed full-time residency Sojourned in Canada for 183 or more days 2. Full-time residency Based on continuing relationship with Canada based on surrounding facts 3. Part-time residency Severing or creating ties to Canada in departure or arrival 4. Non-resident Not resident under 1 3 above entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 31

Income Inclusions Employment Income Includes remuneration and taxable benefits reported on T-4 Property Income Includes interest, dividends, royalties and rental income Business Income Includes self employment income such as consulting Taxable Capital Gains Includes 50% of capital gains in excess of capital losses Other Sources Includes items such as pensions, RRSP and alimony entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 32

Scholarships, Fellowships and Bursaries Taxable to the recipient net of available exemption Amounts received from the employer of a parent are included in the child s income Amount received by an employee from his/her employer are taxable as employment income and not eligible for the exemption entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 33

Scholarships, Fellowships and Bursaries Exemption calculated as the aggregate of: I. Scholarships, fellowships and bursaries received for enrollment in: II. A program for which the education deduction can be claimed; or An elementary or secondary school educational program The lesser of: Scholarships, fellowships, bursaries and prizes received to be used in production of literary, dramatic, musical or artistic work; and Amounts expended to produce the work III. Lesser of: $500; and amounts received in excess of exemption claimed in i. and ii. entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 34

Research Grants Amount received in excess of allowable expenses is taxable in year of receipt An amount is not considered received if all the following conditions are met: Funds are available to individual who has an academic appointment to university; Funds are paid directly to university; Funds are to be used solely for costs of research; and Funds were not used or otherwise available for personal benefit of individual Allowable expenses include cost of equipment, fees, laboratory, charges, etc and exclude: Personal living expenses; Unreasonable amounts; and Amounts otherwise deductible or paid/reimbursed by University entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 35

Motor Vehicle Expenses Deductible if: Ordinarily required to carry on duties away from place of employment Required to pay expenses under employment contract Not in receipt of non-taxable allowance for motor vehicle expenses Form T2200 signed by employer Amount of expenses not limited but amounts must be reasonable and substantiated by receipts and records entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 36

Dues and Other Expenses of Performing Duties Amounts paid in year as: Annual professional dues necessary to maintain professional status Office rent, salary of assistant or substitute if required by employment contract Cost of supplies consumed in duties if required by employment contract Annual union dues Require a Form T2200 signed by employer entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 37

Registered Retirement Savings Plan Contributions Annual limit calculated as the lesser of: 18% of prior year s earned income, and Annual dollar limit (see below) (reduced by pension adjustment for prior year) Annual dollar limits: 2015 2016 2017 Current $24,930 $25,370 $26,010 Indexed based on increases in average wage levels Pension adjustment is value of pension earned in prior year entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 38

Moving Expenses Moving expenses incurred in respect of a move originating outside Canada are not deductible Moving expenses deductible in respect of a move to a new business or employment in Canada if: Both the old residence and new residence are in Canada; and Distance between new residence and new work is at least 40 km closer than old residence Deduction is limited to business or employment income at new location and undeducted amounts may be carried forward entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 39

Moving Expenses Deductible moving expenses include: Travel costs for family members Transportation and storage of household effects Cost of meals and accommodations for up to 15 days during the move Lease cancellation costs in respect of old residence Selling costs of old residence Legal fees, transfer taxes in respect of new residence if old residence was sold Up to $5,000 related to mortgage interest, property taxes, insurance, heat and power on vacant old residence during period reasonable efforts made to sell Utility connection and disconnection fees and costs related to revising legal documents to reflect new address entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 40

2015 Personal Tax Credits Federal Ontario Tax rate applied 15.00% 5.05% Basic personal $11,474 $ 10,011 Spousal/partner 11,474 8,500 - income threshold nil 850 Canada Child Benefit - Replaces the child tax credit and universal child care benefit - Income tested and not taxable Children s fitness amount 500* $56 refundable credit (10% of eligible expenses up to $560) Children s arts amount 250* Adoption 15,453 12,033 Disability 8,001 8,088 Medical** ------Amount paid------- -income threshold (see footnote) 2,237 2,266 *To be eliminated for 2017 and subsequent taxation years **Medical credit is for eligible medical expenses exceeding lesser of : 3% of net income Threshold amount entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 41

2016 Personal Tax Credits Federal Ontario Tax rate applied 15.00% 5.05% CPP (max) $2,544 $2,544 EI (max) 955 955 Education (including textbook amount) - Full time per month 465** 539** - Part time per month 140** 161** Tuition -------Amount paid--------** Interest on student loan -------Amount paid-------- ** - Federal Education and Textbook tax credit 2016 budget proposes to eliminate effective January 1, 2017 - Ontario Tuition & Education Credits 2016 budget proposes to eliminate effective for studies beginning in September 2017 entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 42

Charitable Donations Tax Credit Gifts to: Registered charity Registered Canadian amateur athletic association An exempt housing corporation A Canadian municipality The United Nations or an agency of UN A prescribed university o/s Canada A charitable organization o/s Canada to which Canada made a gift in year or preceding year May claim gifts made in year and preceding five years Federal and Ontario credit of 15% on first $200 and 33% on remainder to of 75% of net income Foreign donations may be used to reduce Canadian tax on foreign source income from the same jurisdiction entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 43

First-Time Donor s Super Credit For first-time donors, a federal tax credit of 25% is available for the first $1,000 of monetary charitable contributions. First-time donors are those who: Have not claimed a donation tax credit between the 2008 and 2013 taxation years Do not have a spouse who has claimed a donation tax credit between the 2008 and 2013 taxation years entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 44

Consulting Income / Business Income Consulting income is included in the calculation of business income on Form T2125 An unincorporated business must have a December 31 year end Required to register for GST purposes if taxable sales exceed $30,000 in a fiscal period Business income is calculated on an accrual basis and not on a cash basis Accounts receivable at year end included in income Accounts payable at year end deducted from income entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 45

Business Expense Limitations The ITA prohibits deduction of: an outlay unless incurred for purpose of earning business or property income an outlay of a capital nature an outlay incurred to earn exempt income nature a reserve for contingent liability, unless otherwise allowed a personal or living expense club or recreational facilities dues and amounts incurred for use or maintenance a yacht, a camp, a lodge, or a golf course entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 46

Business Expense Limitations One-half the cost of meals and entertainment subject to exceptions for office functions and work at remote work locations Home office expense unless: Principal place of business; or Used on regular and continuous basis for meeting clients, customers or patients Remuneration unpaid within 179 days of taxation year entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 47

Incorporation of Consulting Income Unincorporated Business Proprietorship Income $100,000 Income Tax Incorporated Business Consulting Company $0 Corporate $15,500 Mr. A $53,530 Personal $38,279 Mr. B $53,530 Total Tax $53,779 entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 48

Incorporation of Consulting Income Advantages: 11% tax rate on first $500,000 of taxable income from business sources Capital gains exemption Only applies to sale of shares $824,176 for qualified small business corporation shares Ability to split income with family members Flexibility in remuneration package and in timing of receipts entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 49

Incorporation of Consulting Income Disadvantages: Shareholder benefits can apply if corporation pays personal expenditures or has a loan receivable from the shareholder Complexity additional reporting requirements have to maintain separation between corporation and individual Set-up costs and annual carrying costs entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 50

International Income Tax Conventions Select Non-Resident Withholding Tax Rates Interest Dividends Royalties Pensions Australia 10% 5/15% 10% 15/25% China, People s Rep 10% 10/15% 10% 25% France 10% 5/15% 0/10% 25% Germany 10% 5/15% 0/10% 15/25% India 15% 15/25% 10/15/20% 25% Pakistan 15% 15% 0/15% 25% United Kingdom 10% 5/15% 0/10% 0/10/25% United States 0% 5/15% 0/10% 15/25% entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 51

Contacts Stephanie Hall, CPA, CA, CPA (Illinois) Senior Manager T: (519) 747-8201 E: sdhall@kpmg.ca Diane Wood, CPA, CA Partner T: (519) 660-2123 E: dianejwood@kpmg.ca Jeff Hood, CPA, CA CPA (Illinois) Manager T: (519) 747-8238 E: jeffhood@kpmg.ca entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. 53

kpmg.ca/tax This document has been prepared specifically for Western University by KPMG LLP and is of a very preliminary nature intended solely for discussion purposes. This does not constitute tax advice and no action should be taken based on its contents. Any Tax advice in this communication written by KPMG LLP is not intended or to be used, and cannot be used, by any person or entity for the purpose of (i) avoiding penalties that may be imposed on any taxpayer or (iii) promoting, marketing or recommending to another party any matters addressed herein. This presentation may contain a discussion or analysis of decided tax cases. Any discussion or description of the facts of the case or the positions argued by the parties is based solely on publicly available information. For greater certainty no confidential client or taxpayer information is disclosed. This information is current to March 30, 2016. The information contained herein is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavor to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future. No one should act on such information without appropriate professional advice after a thorough examination of the particular situation. 2016 KPMG LLP, a Canadian limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative ( KPMG International ), a Swiss entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International.