Category Archives: Ethics

Perhaps all Canadian banks routinely send out requests, at online account sign-in, to their customers to obtain info on tax residency — and this is old news.

Anyway, this morning I received this online request, for the first time, while trying to sign into my online account at my Canadian bank. I am a long-term customer at the bank:

“Hello STEPHEN,

Request to validate your tax residency information

To comply with Canadian tax law, we’re required to have clients validate that their tax residency information we have on file is correct and complete.

Our records show that your tax residency information needs to be confirmed.

Here are the next steps you need to take
• Online Banking: Select Customer Services > Change your tax residency
• Mobile Banking: Select Customer Services > Personal information > Change your tax residency

Please review your tax residency information now and update as required.

I understand

Tax residency is a method used by the Canada Revenue Agency (CRA) and by other countries to determine how much tax you should pay. Most countries, including Canada, determine taxes based on the amount of time you spend in the country, rather than your citizenship. For instance, some Canadians spend the winter months outside of Canada. The U.S., however, taxes all U.S. citizens as U.S. residents. It is your responsibility to determine your tax residency status in other countries.

[Customer clicks on “I understand” and is then asked three questions:]

Are you a tax resident of Canada? Yes/No

Are you a U.S. person for tax purposes? Yes/No

Do you pay taxes in any other country? Yes/No

By selecting continue I declare, as required by Canadian law, that the tax residency information and U.S. person status (including my Tax ID number) are to the best of my knowledge and belief, correct and complete. Failure to provide may result in my account information being reported to the relevant authority and I may be subject to a penalty under the Income Tax Act.”

[BTW, THANKS for the Thursday afternoon donation!]

The below is a Notice of Constitutional Question” just sent by Appellants Gwen and Kazia to alert Attorney Generals in all of the Canadian Provinces and Territories of our upcoming trial in Canada’s Federal Court of Appeal.

It provides a very brief summary of the arguments and the remedy our appellants want.

If you don’t like Canada’s FATCA IGA legislation, please DONATE to help pay our legal expenses.

“NOTICE OF CONSTITUTIONAL QUESTION

The applicants challenge the constitutional validity of:

1. Sections 263-269 of the Income Tax Act R.S.C. 1985, c.1 (5th Supp.) and

2. The Canada-United-States Enhanced Tax Information Exchange Agreement Implementation Act, which is s. 99 and Schedule 3 of the Economic Action Plan 2014 Act, No1, S.C. 2014, c.20

(Collectively the “Impugned Provisions”)

Further, the Applicants seek a remedy pursuant to s.52 of the Constitution Act, 1982, being Schedule B to the Canada ACT (U.K.), 1982, c. 11 that the Impugned provisions are of no force or effect to the extent that they violate s. 8 of the Charter and cannot be saved by s.1.

The question is to be argued on a date to be set [Court is now deciding on the date]

The following are the material facts giving rise to the constitutional question:

1. The impugned provisions operate to compel banks to act as agents for the government in the collection of private information from people who the banks believe have indicia of US citizenship.

2. Those same people are compelled to provide private information to the banks.

3. That information is transmitted from the banks to the CRA and from the CRA to the IRS.

4. The IRS can use that information for the enforcement of its tax laws including for the prosecution of tax evasion.

5. The compelled collection and dissemination of this information is from persons who might never have lived in the United States, who might have citizenship to another country, and who might have no economic, social, familial, cultural or moral ties to the United States.

6. The purpose of the Impugned Provisions is simply to facilitate the interests of the US tax authority.

The following is the legal basis for the constitutional question, as elaborated in the Appellants’ Memorandum of Fact and Law attached to this Notice of Constitutional Question as Schedule A:

1. The privacy in the compelled information is constitutionally protected through section 8 of the Charter and the compelled collection and dissemination of that information constitutes an unreasonable seizure under section 8.

2. The trial judge erred in law in finding that the Impugned Provisions do not violate the rights guaranteed by section 8 of the Charter.

3. The trial judge erred in law by considering factors under the section 8 Charter determination which were irrelevant to that section and, instead, to be properly considered under section 1 of the Charter.”

Dated: March 22, 2021; sent to Attorney General of Canada (who we are suing) and the Attorney Generals of all of the Provinces and Territories of Canada