This paper considers potential tax consequences in business disputes. It reviews corporate tax rules and illustrates different corporate tax planning options and outcomes. It also reviews the tax treatment of damages and settlement amounts. Finally, this paper considers the tax treatment of various expenses often incurred in business disputes, and provides suggestions for obtaining the most favourable tax treatment possible in respect of those expenses.

This paper is part of a collection presented at LESA’s Business Disputes program in Lake Louise on May 5, 2018.