Realization Principle

Table of Contents

See Also

Cassan v. The Queen, 2017 TCC 174

amount should not be recognized until ascertainable

In finding that Reg. 7000(2)(d) should not be interpreted so as to require the accrual of interest whose amount was not yet determinable, Owen J stated (at para. 403):

The approach taken in each of paragraphs 7000(2)(a) through (d) is consistent with the general proposition that an amount is not recognized as income under the ITA unless the amount can be ascertained with some reasonable degree of certainty.

Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 118.1 - Subsection 118.1(1) - Total Charitable Gifts common law gift was vitiated by loan to donor at unreasonably low rate 746
Tax Topics - Income Tax Act - Section 143.2 - Subsection 143.2(12) although borrowing by taxpayers had a term of 9.3 years, they had a reasonable expectation of refinancing with the promoter’s assistance 466
Tax Topics - Income Tax Act - Section 143.2 - Subsection 143.2(7) - Paragraph 143.2(7)(a) loans were not bona fide in that not handled with commerciality 655
Tax Topics - Income Tax Regulations - Regulation 7000 - Subsection 7000(2) - Paragraph 7000(2)(d) no requirement to accrue interest on index-linked note in a year when the return thereon was not determinable 577
Tax Topics - Income Tax Act - Section 20 - Subsection 20(1) - Paragraph 20(1)(c) - Subparagraph 20(1)(c)(i) interest on loan to acquire LP units was deductible as there was a prospect of gross income being allocated by LP in 19 years’ time 583
Tax Topics - Income Tax Act - Section 69 - Subsection 69(1) - Paragraph 69(1)(c) gratuitous transfer is gift irresepctive of absence of benevolent intent 50

Daishowa-Marubeni International Ltd. v. The Queen, 2010 DTC 1216 [at 3582], 2010 TCC 317, rev'd in part 2013 DTC 5085 [at 5959], 2013 SCC 29

rev'd in part on other grounds 2013 DTC 5085 [at 5959], 2013 SCC 29

Before finding that the consideration in an asset sale represented by the assumption by a purchaser of a future reforestation liability should be heavily discounted from the estimate of its value by the taxpayer's auditors, C. Miller, J. stated (at para. 38) that in the jurisprudence there:

"is a common thread ... that shows the tendency of the Courts to be reluctant to impose tax, regardless of the taxing regime, in situations where the amount could be taxed is uncertain or unascertainable."

Locations of other summaries Wordcount
Tax Topics - Statutory Interpretation - Certainty 80