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Split up of a corporation by shareholders did not violate the anti-surplus stripping provisions

In the Canadian income tax case of McMullen v. The Queen, 2007 TCC 16, the decision of the Tax Court of Canada was that a split up of a corporation by two shareholders did not violate the anti-surplus stripping provisions found in subsections 84(2) and 84.1(1) of the Canadian Income Tax Act, and was not caught by GAAR (the general anti-avoidance rule).

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"This article provides information of a general nature only. It is only current at the posting date. It is not updated and it may no longer be current. It does not provide legal advice nor can it or should it be relied upon. All tax situations are specific to their facts and will differ from the situations in the articles. If you have specific legal questions you should consult a lawyer."

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