When Not to Transfers Between Spouses : beware of section 160 tax implication

Under section 160, a transferee of property may be assessed for the tax liability of the transferor to the extent that the FMV of the transferred property exceeds the FMV of the consideration given for the property.
In recent case Brown v. Queen (2020 TCC 45), a transfer between spouses not attract the application of section 160 because the spouse accepting the transfer will give full consideration in the form of assuming a corresponding obligation to pay the expenses of the transferring spouse. That intention should be reinforced with written documentation, appropriate documentary evidence, supplemented by accounting showing that the obligation was properly discharged.
For more detail please subscribe our newsletter to receive the full article in Dec 2020.

0 replies

Leave a Reply

Want to join the discussion?
Feel free to contribute!

Leave a Reply

Your email address will not be published. Required fields are marked *