Canadian Federal Court of Appeal Upholds Interest on Tax Reassessment for Earlier Year Covered by Loss Carryback

The Canadian Federal Court of Appeal issued a decision on 21 November 2024 on the timing of late payment interest imposed on a reassessment of tax for an earlier year if losses are carried back to cover the reassessment. The case involved a Canadian bank that received a notice of reassessment in 2015 for its 2006 taxation year. In making the reassessment, the tax authority implemented an approximately CAD 55 million audit adjustment, raising the Bank’s 2006 income, and also took into account…