Ontario (not Alberta) Resident Trust

On October 14, 2016, the Ontario Superior Court of Justice concluded that the two trusts in The Herman Grad 2000 Family Trust (2016 ONSC 2402) and The Marya Grad Spousal Trust (2016 ONSC 2407)—which filed for income tax purposes as Alberta-resident trusts—were in fact resident in Ontario and not Alberta for their 2006 to 2009 taxation years. The Ontario minister said that the trusts were residents of Ontario and thus subject to Ontario provincial income tax. Alberta's income tax rate at the time in issue was lower than Ontario's, and the family trust was liable to pay $4.7 million more in income tax as an Ontario resident than it would have paid as an Alberta resident. The spousal trust was liable to pay $2.8 million more in income tax as an Ontario resident.