Principal Issues: Whether various penalties and fines are deductible and whether the interest on such fines and penalties is deductible: Federal Income Tax, Provincial Income Tax, GST, Ontario Retail Sales Tax, Source Deductions, Ontario Work Place Safety Insurance Board, and Ontario Ministry of Transportation
Position: Fines and Penalties: Proposed section 67.6 of the Act provides that no deduction is allowed for any fines and penalties other than as prescribed by draft section 7309 of the Regulations. Interest on Unpaid Taxes, Fines, Penalties, Levies and Premiums: a) Federal Income Tax: No b) Provincial Income Tax: No c) GST and Ontario Retail Sales Tax: in certain circumstances d) Unremitted CPP and EI source deductions: Yes e) Ontario Work Place Safety Insurance Board, and Ontario Ministry of Transportation: Deductible if incurred for the purpose of earning income from business.
Reasons: Previous comments given in various interpretations
XXXXXXXXXX G. Moore
May 10, 2005