Cases
Brooke Bond Foods Ltd. v. The Queen, 84 DTC 6144, [1984] CTC 115 (FCTD)
Amounts expended for plans and specifications of a building that ultimately was not constructed were expended for the purpose of creating a...
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| Tax Topics - Income Tax Act - Section 20 - Subsection 20(1) - Paragraph 20(1)(dd) | suitability of site had already been established | 35 |
The Queen v. Royal Trust Corp. of Canada, 83 DTC 5172, [1983] CTC 159 (FCA)
In an underwriting agreement, the taxpayer agreed to issue common shares to the underwriter at $8.00 per share and pay an underwriting commission...
See Also
Devon Canada Corporation v. The Queen, 2018 TCC 170
Two public-company predecessors by amalgamation of the taxpayer made cash payments for the surrender by employees of their options previously...
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| Tax Topics - Income Tax Act - Section 20 - Subsection 20(1) - Paragraph 20(1)(e) - Subparagraph 20(1)(e)(i) | quaere whether “sale” includes a sale to a 3rd party | 177 |
| Tax Topics - Income Tax Act - Section 111 - Subsection 111(5.2) | stock option surrender payments of target deductible under s. 111(5.2) | 62 |
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Disposition | disposition of surrendered stock options occurred under doctrine of merger | 318 |
| Tax Topics - Income Tax Act - Section 54 - Adjusted Cost Base | "cost" implies the acquisition of an asset | 172 |
Rio Tinto Alcan Inc. v. The Queen, 2016 TCC 172, aff'd 2018 FCA 124
The taxpayer (“Alcan”) incurred various investment dealer, legal and other fees in connection with its successful hostile bid for most of the...
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| Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(a) - Legal and other Professional Fees | investment dealer fees incurred respecting the advisability of making hostile takeover were fully deductible under s. 9 | 417 |
| Tax Topics - Income Tax Act - Section 20 - Subsection 20(1) - Paragraph 20(1)(bb) | investment dealer fees re advisability of making hostile takeover were fully deductible | 529 |
| Tax Topics - Income Tax Act - Section 20 - Subsection 20(1) - Paragraph 20(1)(cc) | legal fees incurred in securing regulatory approval for a hostile bid related to the bidder's business of earning income from shares and interaffiliate sales | 182 |
| Tax Topics - Income Tax Act - Section 20 - Subsection 20(1) - Paragraph 20(1)(g) | takeover bid circular costs did not qualify | 102 |
| Tax Topics - Income Tax Act - Section 169 - Subsection 169(2.1) | raising general question of deductibility of fees and listing s. 20(1)(e) did not satisfy s. 165(1.11) | 246 |
| Tax Topics - Income Tax Act - Section 20 - Subsection 20(1) - Paragraph 20(1)(e) | failure to advance evidence showing allocation of fees to share consideration | 139 |
| Tax Topics - Income Tax Act - Section 40 - Subsection 40(1) - Paragraph 40(1)(a) - Subparagraph 40(1)(a)(i) | expenses incurred in butterfly spin-off recognized as disposition expenses | 63 |
| Tax Topics - Statutory Interpretation - French and English Version | finding common meaning of 2 versions of s. 20(1)(bb) | 108 |
Potash Corporation of Saskatchewan Inc. v. The Queen, 2011 DTC 1163 [at 873], 2011 TCC 213
The taxpayer incurred legal and accounting fees in 1997 and 1998 of approximately $1.9 million in connection with a complicated reorganization of...
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| Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(a) - Legal and other Professional Fees | improved tax efficiency was enduring (3 year) benefit | 232 |
Martin v. The Queen, 2009 DTC 1251, 2009 TCC 152 (Informal Procedure)
"Commissions" paid by the taxpayer (a chartered accountant) generally over the course of several months to the former owners of accounting...
Graham Construction Engineering (1985) Ltd. v. The Queen, 97 DTC 342 (TCC)
Professional fees incurred in connection with a share reorganization of the taxpayer in which its shareholders transferred their shares to a...
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| Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(a) - Legal and other Professional Fees | 110 |
212535 Oil & Gas Ltd. v. MNR, 96 DTC 1263, [1996] 1 CTC 2416 (TCC)
Each taxpayer closed the purchase of a 10% interest in a resource property by giving the vendor an interest-bearing demand promissory note for...
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| Tax Topics - General Concepts - Res Judicata | 80 | |
| Tax Topics - Income Tax Act - Section 20 - Subsection 20(1) - Paragraph 20(1)(e) | 97 |
The Queen v. de Loppinot, 78 DTC 6477, [1978] CTC 705 (FCTD)
An agreement between a retiring chartered accountant ("Peloquin") and a firm of chartered accountants - wherein the firm agreed to pay Peloquin...
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| Tax Topics - Income Tax Act - Section 96 | 97 |
Administrative Policy
14 March 2016 Internal T.I. 2015-0609671I7 - Earnout, Amalgamation, Cost of Shares and ECE
A Canadian Acquisitionco acquired Canadian Targetco for a cash base price plus earnout obligations, and then immediately merged with Targetco...
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| Tax Topics - Income Tax Act - Section 88 - Subsection 88(1) - Paragraph 88(1)(d) | post-amalgamation earnout payment could be applied to increase an s. 88(1)(d) bump of capital property (but not ECP) of the amalgamated target | 317 |
| Tax Topics - Income Tax Act - Section 54 - Adjusted Cost Base | earnout payments an addition to cost of shares which had since disappeared | 90 |
| Tax Topics - General Concepts - Purpose/Intention | attribution of predecessor's intention to Amalco | 140 |
| Tax Topics - Income Tax Act - Section 20 - Subsection 20(1) - Paragraph 20(1)(c) - Subparagraph 20(1)(c)(i) | position on interest deductibility following target amalgamation is based on policy and ITA scheme rather than technical | 350 |
22 March 2016 Internal T.I. 2013-0506561I7 - Property acquired on a return of capital
What is the cost (and amount incurred as an expense) for intellectual property with an unlimited life acquired by a corporation resident in Canada...
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| Tax Topics - Income Tax Act - Section 69 - Subsection 69(4) | FMV cost of property acquired on QROC distribution | 121 |
| Tax Topics - Income Tax Act - Section 69 - Subsection 69(1) - Paragraph 69(1)(c) | FMV cost of property acquired on contribution of capital | 121 |
| Tax Topics - Income Tax Act - Section 54 - Adjusted Cost Base | FMV cost of contributed or distributed property | 53 |
| Tax Topics - Income Tax Act - Section 14 - Subsection 14(5) - Cumulative Eligible Capital - Variable A - Variable A.1 | no gain to FA transferor of ECP | 99 |
30 July 2015 External T.I. 2014-0552041E5 F - Permis XXXXXXXXXX
CRA found that a government licence which could be renewed each year on the payment of a fee was an eligible capital property rather than a Class...
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| Tax Topics - Income Tax Regulations - Schedules - Schedule II - Class 14 | renewable government licences were ECP, not Class 14 | 202 |
S4-F2-C1 - Deductibility of Fines and Penalties
1.21 If a fine or penalty is incurred in connection with the acquisition of an eligible capital property, the fine or penalty is an eligible...
27 June 2014 External T.I. 2014-0526931E5 F - Vente d'une liste de clients par un employé
An employer agrees to purchase the customer list of an employee prior to his cessation of employment. CRA stated (TaxInterpretations...
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| Tax Topics - Income Tax Act - Section 6 - Subsection 6(3) - Paragraph 6(3)(e) | payment to departing employee for customer list was deemed income under s. 6(3) | 113 |
29 October 2013 External T.I. 2013-0507121E5 - Website costs
Determining whether website costs are in the nature of income or capital should entail an analysis of each component of the site. The...
31 March 2011 Internal T.I. 2011-0291701I7
Expenses incurred by a public corporation with respect to an unsuccessful bid to acquire a public company were capital expenditures which...
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| Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(a) - Legal and other Professional Fees | acceptance of BJ Services; merger a capital transaction | 291 |
| Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(b) - Capital Expenditure v. Expense - Contract or Option Cancellation | option cash surrender payments of target | 34 |
12 June 2003 Internal T.I. 2003-001100
As a result of selling a business the taxpayer was no longer able to fulfill its obligations under a supply contract and negotiated a termination...
5 March 2003 External T.I. 2002-0151405 - Transaction Costs - Aborted Acquisition
Respecting the question whether various fees incurred by a taxable Canadian corporation with respect to the proposed acquisition of another...
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| Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(b) - Capital Expenditure v. Expense - Oversight or Investment Management | 69 |
18 February 2002 External T.I. 2002-01883
In a Canadian asset acquisition by a Canadian corporation ("Buyco"), $20 of the total $200 purchase price is allocated to pension surplus. CCRA...
1 March 2001 External T.I. 2001-0068715 - Expenses incurred aborted debt offering
Expenses incurred by a taxpayer with respect to an aborted debt offering where there was no substituted transaction would qualify as eligible...
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| Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(b) - Capital Expenditure v. Expense - Financing Expenditures | 33 |
7 February 1992 TI (Tax Window, No. 16, p. 19, ¶1739)
The proceeds of sale of a sports franchise would be an eligible capital amount to the vendor and an eligible capital expenditure to the purchaser.
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| Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(a) - Timing | 38 | |
| Tax Topics - Income Tax Act - Section 9 - Capital Gain vs. Profit - Contracts | 27 |
28 March 1991 Memorandum (Tax Window, No. 2, p. 25, ¶1186)
Costs incurred by an oil or gas company to acquire an easement to build a pipeline or to acquire a right of way to build a road are eligible...