Depreciable Property

Cases

C.A.E. Inc. v. Canada, 2013 DTC 5084 [at 5944], 2013 FCA 92

The taxpayer leased or entered into leases by it of flight simulators it had manufactured. For financing reasons, it entered into sale and...

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Bosa Bros. Construction Ltd. v. The Queen, 96 DTC 6193 (FCTD)

Prior to the acquisition by the taxpayer of the shares of another taxable Canadian corporation ("Topaz"), Topaz acquired from its then parent...

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Locations of other summaries Wordcount
Tax Topics - General Concepts - Onus 132
Tax Topics - Income Tax Act - Section 20 - Subsection 20(1) - Paragraph 20(1)(p) - Subparagraph 20(1)(p)(ii) interest-free advances to US sub by developer 35
Tax Topics - Income Tax Act - Section 40 - Subsection 40(2) - Paragraph 40(2)(g) - Subparagraph 40(2)(g)(ii) interest-free advances made only re loss protection 49
Tax Topics - Income Tax Act - Section 9 - Capital Gain vs. Profit - Real Estate sale of stratified title property 1 year later on capital account/ secondary intention re ill-affordable property 210

The Queen v. Construction Bérou Inc. (formerly Fortin & Moreau Inc.), 98 DTC 6401 (FCTD), rev'd 99 DTC 5841 (FCA)

The Quebec taxpayer leased various vehicles. It had possession and use of the trucks, it had assumed all risks, it had the option to purchase the...

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Kettle River Sawmills Ltd. v. The Queen, 92 DTC 6525, [1992] 2 CTC 276 (FCTD)

A timber resource property constituted a depreciable property notwithstanding that the taxpayer had not claimed any capital cost allowance in...

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Locations of other summaries Wordcount
Tax Topics - General Concepts - Effective Date 37

Crown Cork & Seal Canada Inc. v. The Queen, 90 DTC 6586 (FCTD)

At the request of the taxpayer, the vendor of equipment purported to pass title in the equipment to the taxpayer in its 1979 taxation year....

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 163 - Subsection 163(2) 60

Kirsch Construction Ltd. v. The Queen, 88 DTC 6503, [1988] 2 CTC 338 (FCTD)

The taxpayer did not acquire title to a roadpaver until after its taxation year-end of March 31, 1977 because the sale did not receive written...

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Alberta Oil Sands Pipeline Ltd. v. The Queen, 88 DTC 6059, [1988] 1 CTC 99 (FCTD)

The taxpayer constructed a new pipeline. In order that any crude oil could be delivered at the end of the pipeline, it was necessary that the...

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The Queen v. Henuset Bros. Ltd. [No. 2], 77 DTC 5169, [1977] CTC 228 (FCTD)

The taxpayer executed on December 29, 1971 conditional sale contracts with a dealer for the purchase of 10 Caterpillar tractors which were then at...

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The Queen v. Kimmel, 76 DTC 6259, [1976] CTC 443 (FCTD)

Both the purchaser and vendor of an apartment building wished to close in December 1968. However, the trustee who held the registered title...

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Locations of other summaries Wordcount
Tax Topics - Statutory Interpretation - Reciprocity 44

The Queen v. Lagueux & Freres Inc., 74 DTC 6569, [1974] CTC 687 (FCTD)

The taxpayer acquired machinery by having a rental company make the purchase and then entering into various leasing agreements with the rental...

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Locations of other summaries Wordcount
Tax Topics - Statutory Interpretation - Provincial Law 61

See Also

Agence du revenu du Québec v. 7958501 Canada Inc., 2022 QCCA 314

A private company (“SherWeb”), which provided, to paying customers, the use of software developed by it, transferred its software for...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 13 - Subsection 13(7) - Paragraph 13(7)(e) software that was not depreciable property to the transferor because it was written off as SR&ED was not subject to s. 13(7)(e) to the NAL transferee 294
Tax Topics - Income Tax Regulations - Regulation 1102 - Subsection 1102(1) - Paragraph 1102(1)(d) software written off as SR&ED was not depreciable property 240

Garber v. The Queen, 2014 DTC 1045 [at 2812], 2014 TCC 1

The taxpayer bought units in a limited partnership, which was to acquire a large yacht to be used for catered vacation charters. The general...

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Good Equipment Limited v. The Queen, 2008 DTC 2527, 2008 TCC 28

The taxpayer purchased farm equipment from a corporation ("Case") for sale or lease. to farmers. In the case of a lease transaction, it entered...

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Locations of other summaries Wordcount
Tax Topics - Statutory Interpretation - Provincial Law 92

Gordon v. The Queen, 95 DTC 493 (TCC)

A film that was described in evidence as being over 50% complete was found to be depreciable property described in Class 10 given that it was...

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Words and Phrases
tangible

Re Cronin Fire Equipment Ltd. (1993), 14 OR (3d) 269 (Ont. Ct. (G.D))

At the request of a customer ("Cronin"), a corporation ("Transportaction") acquired motor vehicles from a dealer, and then entered into agreements...

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Laurent Goulet & Fils Inc. v. MNR, 92 DTC 1611 (TCC)

At the time the taxpayer contacted the lessor ("Hewitt") of equipment to it that it wished to exercise the purchase option, Hewitt suggested...

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Location Gaétan Lévesque Inc. v. MNR, 91 DTC 1380, [1991] 2 CTC 2795 (TCC)

The taxpayer entered into "leasing contracts" respecting heavy equipment which typically had a term of approximately five years, provided for...

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Words and Phrases
property property acquired
Locations of other summaries Wordcount
Tax Topics - General Concepts - Ownership lessee with purchase option not the beneficial owner 117

Westcon Engineering and Contractors Ltd. v. MNR, 77 DTC 284, [1977] CTC 2387 (T.R.B.)

The taxpayer leased three forklift trucks and two trucks which it was entitled pursuant to options to purchase on the expiration of the leases...

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C.R. Stewart Equipment Ltd. v. MNR, 77 DTC 176, [1977] CTC 2232 (T.R.B.)

Rent payments made by the taxpayer pursuant to crane rental lease agreements with a term of six months and purchase options for more than a...

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Chibougamau Lumber Limitée v. MNR, 73 DTC 134, [1973] CTC 2174 (T.R.B.)

The taxpayer leased equipment from finance companies generally for a term of 36 months and with the option to acquire the equipment on expiry of...

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Marine Midland Bank v. U.S., 687 F (2d) 395, 231 Ct. Cl. 496

Contracts of the taxpayer with the U.S. Air Force and Navy for the production of munition trailers stipulated that title would "forthwith vest" in...

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Helby v. Matthews, [1895] A.C. 471 (HL)

A piano was let on hire on the basis that the hirer was to pay a monthly rent, could terminate the hiring by delivering the piano to the owner...

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Administrative Policy

5 October 2018 APFF Roundtable Q. 16, 2018-0768871C6 F - Dépenses de bureau à domicile et d’automobile

In the course of a discussion of the deductibility of home office and automobile expense of an independent contractor where the property is held...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 13 - Subsection 13(7) - Paragraph 13(7)(g) example of proration of capped s. 13(7)(g) capital cost 157
Tax Topics - Income Tax Act - Section 13 - Subsection 13(21) - Undepreciated Capital Cost - A capital cost of co-ownership interest 74
Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(a) - Incurring of Expense payment of expenses of taxpayer by another does not preclude “incurring” by taxpayer 175
Tax Topics - Income Tax Act - Section 9 - Nature of Income payment of taxpayer’s expenses by another might give rise to s. 9 or 80 inclusion 199

S3-F4-C1 - General Discussion of Capital Cost Allowance

Can be depreciable property even if CCA not yet claimed

Depreciable property

1.16 Property will meet the definition of depreciable property in...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(b) - Capital Expenditure v. Expense - Improvements v. Repairs or Running Expense 556
Tax Topics - Income Tax Act - Section 13 - Subsection 13(21) - Undepreciated Capital Cost - A 791
Tax Topics - Income Tax Act - Section 16.1 - Subsection 16.1(1) 275
Tax Topics - Income Tax Act - Section 13 - Subsection 13(28) 254
Tax Topics - Income Tax Act - Section 13 - Subsection 13(27) 222
Tax Topics - Income Tax Act - Section 13 - Subsection 13(29) 155
Tax Topics - Income Tax Regulations - Regulation 1100 - Subsection 1100(2) 212
Tax Topics - Income Tax Regulations - Regulation 1100 - Subsection 1100(2.2) 351
Tax Topics - Income Tax Regulations - Regulation 1100 - Subsection 1100(3) 70
Tax Topics - Income Tax Act - Section 18 - Subsection 18(3.1) 166
Tax Topics - Income Tax Act - Section 13 - Subsection 13(7.5) 207
Tax Topics - Income Tax Act - Section 261 - Subsection 261(2) 65
Tax Topics - Income Tax Act - Section 128.1 - Subsection 128.1(1) - Paragraph 128.1(1)(b) 230
Tax Topics - Income Tax Regulations - Regulation 1102 - Subsection 1102(1) - Paragraph 1102(1)(c) 170
Tax Topics - Income Tax Act - Section 13 - Subsection 13(7) - Paragraph 13(7)(e) 65
Tax Topics - Income Tax Act - Section 43 - Subsection 43(1) 152
Tax Topics - Income Tax Act - Section 68 197
Tax Topics - Income Tax Act - Section 13 - Subsection 13(21.1) - Paragraph 13(21.1)(a) 75
Tax Topics - Income Tax Act - Section 13 - Subsection 13(21.1) - Paragraph 13(21.1)(b) 212
Tax Topics - Income Tax Act - Section 13 - Subsection 13(1) 431
Tax Topics - Income Tax Act - Section 8 - Subsection 8(2) 75
Tax Topics - Income Tax Act - Section 20 - Subsection 20(16.1) 152
Tax Topics - Income Tax Act - Section 13 - Subsection 13(9) 229
Tax Topics - Income Tax Act - Section 152 - Subsection 152(4) 321
Tax Topics - Income Tax Regulations - Schedules - Schedule II - Class 8 237
Tax Topics - Income Tax Act - Section 13 - Subsection 13(5) 317
Tax Topics - Income Tax Act - Section 13 - Subsection 13(6) 221

7 February 2014 External T.I. 2014-0516921E5 F - Crédit et frais résiduels

Before going on to implicitly treat the lessee of automobile leases as the lessee rather than owner thereof, CRA stated:

In the Income Tax...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 6 - Subsection 6(2) employer potentially can choose to prorate terminal credits or deficiencies (based on sale price on car lease termination relative to residual value) in applying formula 263
Tax Topics - General Concepts - Substance lease characterized as lease unless its actual legal effects differ 154
Tax Topics - Income Tax Act - Section 13 - Subsection 13(21) - Undepreciated Capital Cost - A lease under which lessee bore all risk implicitly treated as lease rather than purchase 180

23 January 2012 External T.I. 2011-0409671E5 F - Propriété superficiaire

Corporation A erected, at its expense and for exclusive use in its transport business, a detached garage on the land on which the principal...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 54 - Principal Residence - Paragraph (e) land leased to corporation for business use not part of principal residence 160
Tax Topics - Income Tax Act - Section 15 - Subsection 15(1) benefit if building constructed at corporation’s expense for business purposes becomes shareholder’s property by accession 154
Tax Topics - Income Tax Regulations - Regulation 1102 - Subsection 1102(1) - Paragraph 1102(1)(c) individual shareholder not entitled to claim CCA on building constructed by the corporation for use in its business even where taxpayer owns it 160
Tax Topics - General Concepts - Ownership whether tenant had Quebec right of superficies to garage erected by it determined whether it was its property 91

20 April 2009 External T.I. 2008-0303651E5 - Tax Implications of Leasing Arrangements

A purchase option will not result in the optionholder being considered to have acquired the property where there is no obligation on the part of...

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20 April 2005 External T.I. 2005-0110421E5 F - ACB BUMP on an AMALGAMATION

Immediately prior to the amalgamation of Holdco with Opco, the only assets of Opco were woodlots. In finding that the cost of the land could not...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 88 - Subsection 88(1) - Paragraph 88(1)(c) - Subparagraph 88(1)(c)(iii) land included in timber limit is ineligible property 122

27 January 2003 Internal T.I. 2002-0177677 - TERMINAL LOSS RENTAL PROPERTY

A taxpayer disposed of a rental property on which no CCA had ever been claimed because of the rental property restriction rule in Reg. 1100(11)...

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5 July 2002 External T.I. 2002-0121115 F - CREDIT-BAIL

CCRA indicated that if, under a financing lease, the lessor remained the owner of the property under the governing provincial law (the Civil Code...

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IT-464R, para. 3

A leasehold interest is not considered to be a depreciable property until a capital cost is incurred with respect to the property.

Income Tax Technical News, No. 5, 28 July 1995

Until several cases currently before the courts dealing with the issues pertinent to IT-233R have been rendered, the guidelines in that Bulletin...

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93 C.P.T.J. - Q.20

An asset that otherwise meets the definition of CEE or CDE must always have its cost amortized in the form of capital cost allowance rather than...

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30 December 1992 T.I. (Tax Window, No. 27, p. 6, ¶2322)

It is a question or fact whether a taxpayer has acquired a right to use computer software (which is included in Class 12(0)) or a right to market...

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IT-441 "Capital Cost Allowance - Certified Feature Productions and Certified Short Productions"

Discussion of the requirements for a taxpayer to be considered to be the owner of a film.

90 C.R. - Q.16

Where a transaction is a lease, only the lessor is entitled to CCA. Conversely, where it is determined that the agreement results in a disposition...

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88 C.R. - "Finance and Leasing" - "Leasing"

Since CCA accrues only to the owner of the property, where the transaction (having regard to the actual legal rights and obligations of the...

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Articles

Gillespie, "Lease Financing", 1992 Corporate Management Tax Conference, c. 7

Discussion (at pp. 1-20) of the distinction between sales/acquisitions and leases.