[News] John Tavares

[Scooter]

Interesting article on John Tavares tax appeal to CRA in the National Post and Toronto Star and Toronto Sun. If he loses this appeal it would be a good reason for any future superstars not wanting to play in Canada.

[Moneyhands23]

Ya this shows how canada is truly a disadvantaged place for athletes

[Ashasx]

nm

[Torture]

Thanks for including the link so that we know what you're talking about Eric.

[Bonded]

Originally Posted by Ashasx

I don't know why he would think he only had to pay 15% tax on a signing bonus. Almost $71 million of his $77 million contract is paid in bonuses on July 1.

Did they really think they would only pay 15% tax on 92% of this contract? Are they stupid?

I’ll take a 15% tax rate on my bonuses.

[Harry Lime]

I clicked on this because I thought that Taveras was outed as an alien and attacked the Vatican in his leaf ship. Left disappointed.

[Ashasx]

Originally Posted by Bonded

I’ll take a 15% tax rate on my bonuses.

After reading the article, it looks like they are only claiming 15% tax on the first signing bonus paid in 2018.

However, Tavares argues that the bonus was paid into his New York-based bank account in July 2018 and that he spent only 45 days in Canada between September and December of that year, once he began playing with Leafs.

...

As such, he argues, the 2018 portion of the bonus should be taxed at only the 15-per-cent U.S. inducement rate.

It looks like it's more of a question of which country he earned income in.

[Erick Estrada]

I hope he has to pay up. Rich folks should pay taxes just like everyone else.

[jaikorven]

Originally Posted by Ashasx

It looks like it's more of a question of which country he earned income in.

This is very important to realize, thank you for the clarity.

[GioforPM]

Originally Posted by Ashasx

After reading the article, it looks like they are only claiming 15% tax on the first signing bonus paid in 2018.



It looks like it's more of a question of which country he earned income in.

Seems to me like he is creating a situation where everyone will stay in tax free areas in the summer and thus "earn" their signing bonuses (even in subsequent years since they are paid then) elsehwere than where their team is located.

I actually think the rule that they earn where they play away games is messed up too. I pay AB provincial tax, not Ontario, even if I go and appear in court in Ontario from time to time.

[Scooter]

Originally Posted by Ashasx

After reading the article, it looks like they are only claiming 15% tax on the first signing bonus paid in 2018.



It looks like it's more of a question of which country he earned income in.

His argument is the 15% tax rate is a provision of Canada-U.S. taxation treaty, which sets aside the lower tax rate for "inducements" such as signing bonuses, paid to athletes, artists, actors, and musicians.

[Jay Random]

Originally Posted by GioforPM

Seems to me like he is creating a situation where everyone will stay in tax free areas in the summer and thus "earn" their signing bonuses (even in subsequent years since they are paid then) elsehwere than where their team is located.

It doesn't work if you live in your team's jurisdiction for the majority of the year. Tavares only has a case because he was with a U.S. team for the first half of the year, and only moved to Canada in September for training camp.

[GioforPM]

Originally Posted by Scooter

His argument is the 15% tax rate is a provision of Canada-U.S. taxation treaty, which sets aside the lower tax rate for "inducements" such as signing bonuses, paid to athletes, artists, actors, and musicians.

This makes more sense, but then you just get into the interpretation of the treaty and the statute vis-a-vis NHL signing bonuses.

[The Fonz]

It is beyond due for the NHL to address the tax variances across the different jurisdictions within in the league, by way of adjusting team's cap ceilings.

Doesn't make a lot of sense that all teams have the exact same cap ceiling, but some of those team's players don't pay state taxes.

[GioforPM]

Originally Posted by The Fonz

It is beyond due for the NHL to address the tax variances across the different jurisdictions within in the league, by way of adjusting team's cap ceilings.

Doesn't make a lot of sense that all teams have the cap ceiling, but some of those team's players don't pay state taxes.

This is the easiest fix of all the location issues. NHL can't adjust for weather or big city life or home towns. But adjusting for taxes year to year doesn't seem that hard.

[Johnny Makarov]

We DO NEED YOU!
We DO NEED YOU!
We DO NEED YOU!
We DO NEED YOU!
We DO NEED YOU!

... to pay your taxes...

[Badgers Nose]

Originally Posted by harry lime

i clicked on this because i thought that taveras was outed as an alien and attacked the vatican in his leaf ship. Left disappointed.

the liberal media don't want you to know!

[kipperiggy]

Canadian tax system is based on residency.

I do not know the intricacies of the tax treaty between the two countries but on a surface level if Tavares is a Canadian citizen not residing in Canada more than ~180 days then he would be taxed on that income in the US, so taxing him again on the same earnings in Canada would be double taxation of the same income, which is the whole point of the treaty.

Point being, if he loses and has to pay CRA then what happens to the taxes he already paid the IRS?

Oh Locke where art thou? I am but a measly auditor who took tax 10+ years ago...

[flambers]

Originally Posted by Scooter

Interesting article on John Tavares tax appeal to CRA in the National Post and Toronto Star and Toronto Sun. If he loses this appeal it would be a good reason for any future superstars not wanting to play in Canada.

I have Googled this topic, not sure how this would affect any future players?

Sounds like its an re-assessment, over his contractual bonus that was included.

Within his contract.

Players filings sounds like, it was not included in total salary.

[kipperiggy]

Originally Posted by GioforPM

Seems to me like he is creating a situation where everyone will stay in tax free areas in the summer and thus "earn" their signing bonuses (even in subsequent years since they are paid then) elsehwere than where their team is located.

I actually think the rule that they earn where they play away games is messed up too. I pay AB provincial tax, not Ontario, even if I go and appear in court in Ontario from time to time.

I thought that was only American citizens.