The family of a dead millionaire Toronto philanthropist have been rejected in their bid to get a charitable tax receipt for more than $17 million, says Blacklock’s Reporter..Evidence in family tax court showed Edmond Odette’s heirs arranged a $17.7 million credit on an IOU..“Put simply, Parliament does not want to grant a tax credit where the donor is not impoverished and the charity is not enriched,” wrote Justice Eugene Rossiter..His ruling came in an appeal of a federal tax audit by Odette’s estate..Odette, a Toronto builder who founded Eastern Construction Ltd., died in 2012 at 86 and left a $45.9 million estate. He donated millions to local hospitals, universities and charities through a family foundation..Tax records showed Odette left the bulk of his estate in a personal holding company, Edmette Holdings Ltd..After his death, Odette’s heirs arranged to transfer an IOU for $17,710,000 in shares from Edmette Holdings to the family foundation in exchange for a charitable tax receipt..Odette’s family planned to “distribute the assets of Mr. Odette in the most tax-efficient manner,” wrote Rossiter..On December 23, 2013 with four business days left in the year, the holding company issued its IOU and the foundation issued the tax receipt..“The only thing ‘received’ by the foundation was the promissory note,” said the court..“A non-arm’s length promissory note creates no real obligation to pay,” wrote Rossiter..“Non-arm’s length parties can artificially enter into similar transactions, claim a donation tax credit and never actually make payments..“For this reason it is important to show the charity is actually enriched and the donor is in fact impoverished. A promissory note between non-arm’s length parties is not convincing enough.”.Rossiter called the Christmas Eve arrangement “part of a plan to maximize charitable donations and claim a credit” for the tax year..“The plan failed,” he wrote..Local charities mourned Odette as one of their greatest benefactors when he died nine years ago. His donations included the Edmond Odette Cancer Centre at Toronto’s Sunnybrook Health Sciences Centre, the Edmond Odette School of Business at the University of Windsor, Odette Family Gallery at the Art Gallery of Ontario and Odette Memorial Library in Tilbury, Ont..Odette in 2001 was awarded the Order of Canada as “a kind and generous man.”
The family of a dead millionaire Toronto philanthropist have been rejected in their bid to get a charitable tax receipt for more than $17 million, says Blacklock’s Reporter..Evidence in family tax court showed Edmond Odette’s heirs arranged a $17.7 million credit on an IOU..“Put simply, Parliament does not want to grant a tax credit where the donor is not impoverished and the charity is not enriched,” wrote Justice Eugene Rossiter..His ruling came in an appeal of a federal tax audit by Odette’s estate..Odette, a Toronto builder who founded Eastern Construction Ltd., died in 2012 at 86 and left a $45.9 million estate. He donated millions to local hospitals, universities and charities through a family foundation..Tax records showed Odette left the bulk of his estate in a personal holding company, Edmette Holdings Ltd..After his death, Odette’s heirs arranged to transfer an IOU for $17,710,000 in shares from Edmette Holdings to the family foundation in exchange for a charitable tax receipt..Odette’s family planned to “distribute the assets of Mr. Odette in the most tax-efficient manner,” wrote Rossiter..On December 23, 2013 with four business days left in the year, the holding company issued its IOU and the foundation issued the tax receipt..“The only thing ‘received’ by the foundation was the promissory note,” said the court..“A non-arm’s length promissory note creates no real obligation to pay,” wrote Rossiter..“Non-arm’s length parties can artificially enter into similar transactions, claim a donation tax credit and never actually make payments..“For this reason it is important to show the charity is actually enriched and the donor is in fact impoverished. A promissory note between non-arm’s length parties is not convincing enough.”.Rossiter called the Christmas Eve arrangement “part of a plan to maximize charitable donations and claim a credit” for the tax year..“The plan failed,” he wrote..Local charities mourned Odette as one of their greatest benefactors when he died nine years ago. His donations included the Edmond Odette Cancer Centre at Toronto’s Sunnybrook Health Sciences Centre, the Edmond Odette School of Business at the University of Windsor, Odette Family Gallery at the Art Gallery of Ontario and Odette Memorial Library in Tilbury, Ont..Odette in 2001 was awarded the Order of Canada as “a kind and generous man.”
