Revenu Quebec is after about $47 million, including a $6.4 million penalty on one of Chamandy’s numbered companies
Author of the article:
Published Jul 24, 2024 • Last updated 12 minutes ago • 2 minute read
Gildan Activewear Inc. CEO Glenn Chamandy speaks to the media following their annual meeting in Montreal on May 28, 2024. Photo by THE CANADIAN PRESS/Christinne Muschi
Glenn Chamandy, the executive who fought the board of apparel maker Gildan Activewear Inc. and won his old job back, has another opponent now: tax authorities in Canada.
Chamandy and his lawyers are tangling with Revenu Québec, a provincial tax collection agency, over tax filings he made years ago. The agency is after about $47 million, including a $6.4 million penalty on one of Chamandy’s numbered companies.
Advertisement 2
This advertisement has not loaded yet, but your article continues below.
THIS CONTENT IS RESERVED FOR SUBSCRIBERS ONLY
Subscribe now to read the latest news in your city and across Canada.
Exclusive articles from Barbara Shecter, Joe O’Connor, Gabriel Friedman, Victoria Wells and others.Daily content from Financial Times, the world’s leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.
SUBSCRIBE TO UNLOCK MORE ARTICLES
Subscribe now to read the latest news in your city and across Canada.
Exclusive articles from Barbara Shecter, Joe O’Connor, Gabriel Friedman and others.Daily content from Financial Times, the world’s leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.
REGISTER / SIGN IN TO UNLOCK MORE ARTICLES
Create an account or sign in to continue with your reading experience.
Access articles from across Canada with one account.Share your thoughts and join the conversation in the comments.Enjoy additional articles per month.Get email updates from your favourite authors.
Sign In or Create an Account
or
Article content
At issue are so-called “straddle” trades, a strategy that used forward foreign exchange contracts to generate tax losses in one year, with offsetting gains the following year.
The contracts have been used by some Canadian taxpayers as a strategy to reduce or defer income taxes, but the practice was challenged by tax authorities. In Chamandy’s case, Revenu Québec disallowed trading losses booked by one of his companies on the grounds that the foreign exchange contracts were “shams,” according to documents.
In a 2022 decision in a separate case, the Federal Court of Appeal ruled in the government’s favour, stating that straddle transactions that are done solely to generate tax losses aren’t legitimate.
“I’m going to sit down with them and review everything, and we’ll see the result. I’m not running away,” Chamandy told the La Presse news site in May when asked about the tax dispute.
Chamandy did not respond to requests for comment from Bloomberg. One of his lawyers, Marie-France Dompierre, declined to comment when reached by phone.
“Revenu Québec and the CRA are more and more aggressive on these types of transactions,” said Yves Picard, a lawyer specializing in Quebec business law, referring to Canada Revenue Agency.
Advertisement 3
This advertisement has not loaded yet, but your article continues below.
Article content
Another issue in the case are large transactions between numbered companies operated by Chamandy in Canada and three companies domiciled in the Bahamas, according to documents. Chamandy owns a luxury golf course in the latter country.
Recommended from Editorial
Gildan CEO lands 84% of votes in board election
Proxy battle cost Gildan $65 million
Chamandy was ousted in December by the board of Gildan in a battle over succession and corporate strategy. But a number of large shareholders led by Browning West LP rallied to Chamandy’s side and started a successful campaign to elect their own slate of directors and bring him back as chief executive.
Bloomberg.com
Article content
>>> Read full article>>>
Copyright for syndicated content belongs to the linked Source : Financial Post – https://financialpost.com/pmn/business-pmn/gildans-reinstated-ceo-embroiled-in-tax-dispute-over-forex-trades
