Which of the Following Statements Regarding GAAR Is True

question 3

Multiple Choice

Which of the following statements regarding GAAR is true?

• A) The purpose of GAAR is to catch tax evaders.
• B) The Canada Revenue Agency states that "A transaction will not be an avoidance transaction if the taxpayer establishes that it is undertaken primarily for bona fide business, investment or family purposes."
• C) When an avoidance transaction takes place, the anti-avoidance rule is automatically applied in all circumstances.
• D) Individuals who organize their affairs in order to pay as little tax as possible will automatically be subject to GAAR.

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Definitions:

Afferent Peripheral

Pertaining to peripheral nerves that carry signals toward the central nervous system from the body, involved in sensory processing.

Nerve Fibers

Extensions of neurons that transmit electrochemical signals throughout the nervous system, enabling communication and response to stimuli.

Transduction

The process of converting one form of energy into another, or in biology, the transfer of genetic material from one organism to another.

Triple Cardiac Bypass

A surgical procedure to improve blood flow to the heart by diverting blood around narrowed or blocked arteries using graft vessels.