Tax & Trade Blog

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DIRECTOR'S LIABILITY FOR HOME BUILDERS

 CRA TARGETS CORPORATE DIRECTORS

As we have blogged about here and here, the CRA continues to assess home builders, renovators and others in the residential real estate industry on the basis that their activities may constitute a business subject to GST/HST.

A recent Tax Court of Canada (“TCC”) decision in Ayoub v. the King, 2025 TCC 48 illustrates both the complexity of these rules and the risk that corporate directors can be held personally liable for unremitted GST/HST – even when the corporation is the builder!

As we have blogged about here and here, the CRA is after a whole swath of residential homeowners who are finding themselves being taxed on the sale of their new or used residential properties, after substantially renovating them.

A recent decision of the Tax Court of Canada (“TCC”) in Bryan v. The King, 2024 TCC 108 highlights the problems that homeowners face when going into these ventures with possible “dual motivations”.