TD Bank Wins Federal Court of Appeal Ruling on Income Tax Act Deemed Trust
Date
February 9, 2026Office Involved
On February 9, 2026, The Toronto‑Dominion Bank (TD Canada Trust) (“TD Bank”) obtained a favourable decision from the Federal Court of Appeal in its appeal in The Toronto‑Dominion Bank (TD Canada Trust) v. His Majesty the King, 2026 FCA 25.
The appeal concerned the interpretation of the deemed trust provisions under section 227 of the Income Tax Act, and whether the deemed trust extends to property held by unsecured creditors of a tax debtor. The Federal Court of Appeal allowed TD Bank’s appeal and overturned a decision of the Federal Court, concluding that the deemed trust does not extend to property held by unsecured creditors.
McCarthy Tétrault LLP advised TD Bank with a team led by Anu Koshal that included Almut MacDonald (Tax Litigation).
