ONYX Tax Maxter's
Maxing out your assets in taxing times

General Anti-Avoidance Rule (GAAR)

The legal opinions of many that represent these illegal tax shelters tend to skim over the idea of GAAR. They will tell you, in their opinion, what it is and how it works, then conclude that it doesn't apply to their tax shelter.

It's hard to understand how GAAR can not apply to someone using a charitable gifting arrangement where they receive a donation receipt far greater than the amount they donate. In fact, there is a high chance that CRA will invoke GAAR and audit those that submit donation receipts that are significantly higher than their out-of-pocket cash donated.

In a very general sense GAAR means that if you donate a gift with sole intent to save on taxes, it is not a valid gift and can't be used to save on taxes.

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