Nova Scotia businessman John Risley is shown at his Halifax home in 2022.
One of Nova Scotia's most prominent and wealthy businessmen is locked in a massive income tax battle with the Canada Revenue Agency, one that spans two decades and includes a sprawling seaside mansion, a high-performance dressage horse operation and three luxury yachts.
Under the Income Tax Act, the value of "benefits" conferred by a corporation to a shareholder is considered part of their income and should be taxed. For instance, if a company pays for a vacation, the value of that trip is considered taxable income. Risley has filed three separate appeals in the Tax Court, including two in 2018 and one this summer, which say he relied on a team of accountants and tax specialists to advise him and prepare his returns.John Risley's World Energy GH2 wants to sell power to Hydro each winter — and claims it will have lots of it
The CRA declined an interview request, as did Cecil Woon, the Department of Justice lawyer handling the appeal. There are high-profile cases, too, such as Cirque du Soleil co-founder and Quebec businessman Guy Laliberté, who unsuccessfully challenged a CRA reassessment that found a $42-million trip he took to space was a taxable benefit.
"It can be really tough for taxpayers," Worsfold said. "Because the CRA, once they're assessing penalties, there's no restriction on time. So you're looking at a really difficult threshold to meet in terms of evidentiary proof.
Risley's three appeal cases offer insight into items of luxury and expense that surround one of Nova Scotia's best-known businessmen, and how they've been financed.
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