Tax Disputes and Tax Litigation

Tax disputes are increasingly complex, high-stakes, and time-sensitive. Businesses face aggressive enforcement, shifting legislation, and mounting pressure to resolve matters before they escalate. Whether dealing with audits, objections, or appeals, the risks to reputation, operations, and financial stability are significant.

Our Tax Disputes and Tax Litigation team helps clients manage these risks by working closely with our technical tax experts to bring strategic clarity and legal precision to complex matters. This proven collaboration allows us to resolve disputes early and litigate effectively when needed.

Seamless tax law advice – across industries and courts

With a 150-year reputation as Canada's preeminent litigation firm, and backed by one of the top national and bilingual tax practices in Canada, we are counsel to large domestic and international corporations on all manner of tax disputes. Our clients span the financial services, natural resources and energy, technology, manufacturing, and private wealth sectors.

We provide experienced, skilled representation before all tax authorities and courts, including the Tax Court of Canada, the Federal Court of Appeal, and the Supreme Court of Canada. Our expertise is frequently relied upon by other firms when a matter proceeds to this stage.

Trusted advisors and solutions for complex tax challenges

Beyond litigation, a core part of our practice involves advising on contentious tax matters at every stage – from audits and requests for information to objections, searches and seizures, and appeals. Unlike many firms, we offer both tax litigation and tax planning services in specialized areas such as commodity taxes, providing seamless support and strategy for our clients’ tax issues.

• Proven credibility with tax authorities: We have a well-established reputation for strategic and effective advocacy across jurisdictions. Tax authorities know us and trust our record of success.
• Shaping tax law and policy: We are frequently consulted by the Department of Finance for recommendations on legislative amendments to Canada’s tax laws, reflecting our standing as thought leaders in tax.
• Insider perspective at the highest levels: Many of our lawyers bring added depth from prior roles within the Department of Justice, the Canada Revenue Agency’s Rulings Directorate, the Department of Finance, and the Tax Court of Canada. Several serve on senior government advisory committees, providing strategic insights that help shape tax policy and administrative practices.

Examples of our work:

• Counsel to a leading financial institution in an appeal to the Federal Court of Appeal regarding the availability of input tax credits on services provided to a non-resident acquirer and credit card payment processor.
• Counsel to global mining company in an application for leave to appeal to the Supreme Court of Canada a decision regarding the tax treatment of “break fees” paid as a result of a failed merger.
• Counsel to a public energy company in an appeal to the Federal Court of Appeal concerning the application of s. 111(5) of the Income Tax Act.
• Counsel to a Schedule 1 Chartered Bank in a successful appeal to the Federal Court of Appeal regarding the availability of notional input tax credits for credit card issuers who award loyalty points to cardholders.
• Counsel to a global automotive company in a significant tax appeal to the Tax Court of Canada.
• Counsel to UK-based energy company in an appeal to the Federal Court of Appeal regarding the application of the general anti-avoidance rule to the resource rules in the Income Tax Act.
• Counsel to a leading financial institution in an action before the Federal Court regarding whether the deemed trust provisions of the Income Tax Act apply to unsecured creditors who received the proceeds of the sale of the tax debtor’s property. 
• Counsel to a global energy company in its appeal before the Federal Court of Appeal regarding the interpretation of the Canada-Luxembourg treaty.
• Counsel to a leading technology company in various provincial and federal tax dispute resolution and compliance matters, including the renewal of certified e-invoicing authorizations in Quebec.
• Counsel to one of Canada’s largest shipping terminals in an appeal before the Tax Court of Canada regarding the availability of Class 14.1 CCA deductions.

Reach out to discuss your needs with a member of our team. And check out the latest issue of McCarthy Tétrault’s Tax Disputes Newsletter to stay on top of the news, trends and updates impacting the tax disputes and tax litigation landscape in Canada.