Former Blue Jays stars win tax fight, sparing millions in liabilities
Josh Donaldson and Russell Martin have secured a court victory that absolves them of additional taxes on millions of dollars of income.
In Ottawa, the Federal Court of Appeal confirmed a Tax Court decision that the Canada Revenue Agency’s assessment of former Blue Jays all-stars Josh Donaldson and Russell Martin was erroneous. The agency had challenged the players’ use of Retirement Compensation Agreements, claiming the contributions should be deducted before applying the 60/40 split of time spent in the United States versus Canada. Represented by lawyer Marie-France Dompierre, the athletes maintained that the deductions belong only to the Canadian-earned portion.
The courts agreed, finding the CRA’s interpretation “faulty” and ruling that the players owe no additional taxes on the millions in question. The judgment removes a potential multi-million-dollar liability for both former players. The case highlights how high-earning non-residents navigate Canada’s tax framework, especially regarding pension-type plans.
Why it matters
The ruling clarifies tax treatment for foreign athletes using retirement plans, affecting future recruitment and financial planning in Canadian sports.
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