Principal Issues: Whether the proposed transactions qualify for the butterfly exemption found in paragraph 55(3)(b).
Position: Yes.
Reasons: The proposed transactions meet the requirements found in paragraph 55(3)(b) and are not subject to any of the butterfly exemption denial rules found in subsection 55(3.1).
Principal Issues: Whether payments provided to, or made on behalf of, an elected member of a provincial legislative assembly for housing and incidental expenses are required to be included in income?
Position: Likely no. Where it is established that the constituency office of an elected member of a provincial legislative assembly is a regular place of employment, that member will likely be considered to be travelling to perform duties related to the legislative assembly at another location.
Reasons: An employer’s direct payment of, or a reasonable allowance or reimbursement provided to an employee for travel expenses is not included in income under subsection 6(1) of the Income Tax Act in such circumstances.
