Canadian Lawyer

www.canadianlawyermag.com 27 "You have to think twice when doing litigation; you need to re-evaluate the benefits of preliminary proceedings, … and all those proceedings [which] will just add delays." Pierre-Louis Le Saunier, Stikeman Elliott LLP CANADA'S MYRIAD COVID-19 SUBSIDY PROGRAMS Canada Recovery Benefit (CRB) Canada Recovery Caregiving Benefit (CRCB) Canada Recovery Sickness Benefit (CRSB) Canada Emergency Rent Subsidy (CERS) Canada Emergency Wage Subsidy (CEWS) Canada Recovery Hiring Program (CRHP) Canada Emergency Response Benefit (CERB) "It will be business as usual," he says, adding that he was surprised by the CRA's decision in the case. David Rotfleisch was also surprised by the decision. He does not doubt that fraudu- lent claims were being made to benefit from government COVID programs "because the scrutiny was not there," says the founding partner of Rotfleisch & Samulovitch P.C. in Toronto. Now, "the CRA is properly doing verification on some of these applications," and the CEWS subsidy program has been extended until November. A Federal Court hearing will provide a judicial review of the CRA's decision to deny the Toronto-based technology company the benefit. Still, Iris's numbers, cited in the case information, "clearly qualify," he says. "I don't know why this is a bare-knuckles brawl here; if it goes any further — if we get another reported decision, it's going to be interesting to see what the real story behind the scenes is." Limitation periods in civil matters were also suspended during the pandemic for 26 weeks, between mid-March and mid-Sep- tember 2020. Another issue that will arise in tax disputes is whether tax authorities were allowed to issue reassessments during that time, says Le Saunier. Advice for employers Aside from thinking twice about litigating when settlements are an option ("you may be caught up in litigation for years," says Le Saunier), it is essential to keep accurate records. The claimant will need to demon- strate that the assumed facts are wrong, and "the best way to do that — to stop the dispute at an early stage — is to have the actual docu- ments" for claiming certain benefits, incen- tives and subsidies, he says. "Very often we see that the client is enti- tled to the benefit, but they're not able to demonstrate that the conditions were met." During the pandemic, businesses have not been functioning normally, and record- keeping may have been onerous. "If you can show the documents, it's worth 1,000 words of a witness sometimes," he says, in demonstrating that certain expenses were incurred. An audit may not be performed until three or four years after that taxation year, and "that's when it becomes key." "Hang on to all your paperwork and all your evidence" supporting claims for bene- fits, Le Saunier adds. "It's not the most pleasant [advice] to hear … but it's so unfor- tunate when you know the client did the right thing, but they cannot demonstrate or establish their right."

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