Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.
Principal Issues: Whether a self-employed professional golfer can deduct green fees paid for practice rounds.
Position: No.
Reasons: Wording of 18(1)(l) and that there are no exceptions provided for golf professionals.
XXXXXXXXXX
2012-045775
Charles Rafuse
September 17, 2012 613-247-9237
Dear XXXXXXXXXX:
Re: Deductibility of Green Fees
This is in response to your email of August 2, 2012, concerning the application of subparagraph 18(1)(1) of the Income Tax Act (the “Act”) as it may apply to a self-employed professional golfer.
You have noted that subparagraph 18(1)(l)(i) of the Act denies a deduction for outlays or expenses made or incurred by a taxpayer for the use or maintenance of property that is a golf course or facility. It is your interpretation that this provision would appear to deny a self-employed professional golfer from deducting green fees paid for playing practice rounds (i.e., training) at any golf course and have asked for our comments.
Regardless of whether or not the self-employed professional golfer has a business purpose with respect to the costs incurred for green fees, paragraph 18(1)(l) of the Act does not permit a self-employed golf professional to deduct these costs. In particular, this provision provides, inter alia, that “no deduction shall be made in respect of … the use or maintenance of property that is … a golf course or facility unless the taxpayer made or incurred the outlay or expense in the ordinary course of the taxpayer’s business of providing the property for hire or reward”. Since a self-employed professional golfer would not appear to be providing the property (i.e., the golf course) for hire or reward, we agree with your interpretation of the application of subparagraph 18(1)(l) in the above-described situation.
We trust that these comments will be of assistance.
Yours truly,
Michael Cooke
Manager
Business and Capital Transactions Section
Business and Trusts Division
Income Tax Rulings Directorate
Legislative Policy and Regulatory Affairs Branch
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