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Daily Tax Report: International

Bankruptcy Fight Over Tax Collection Heads to Canada’s Top Court

March 26, 2020, 9:10 PM

Canada’s top court has agreed to take up a case on whether an insolvent company’s money should go to tax collection or creditor payments during a bankruptcy process.

The Supreme Court of Canada on Thursday granted an application for leave to appeal from the Canada Revenue Agency, which is challenging an Alberta Court of Appeal decision in August that sided with accounting firm Ernst & Young and the Business Development Bank of Canada.

The accounting firm and the bank argue that Canada’s main bankruptcy legislation, the Companies’ Creditors Arrangement Act, takes precedence over the Income Tax Act and two other...

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