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.
CGA ASSOCIATION ROUND TABLE
QUESTION
A recent article in the CGA Magazine discussed the contentious issue of business meeting expenses and highlighted a case relating to the deductibility of in-country and out-of-country expenses. What are the new guidelines as they relate to business meeting expenses in and out of country?
DEPARTMENT'S POSITION
A distinction must be made between:
- (1) expenses of attending business meetings and
- (2) expenses incurred in attending conventions.
Expenses of attending business meetings must be reasonable in the circumstances and must be business related.
The Department's position with respect to costs incurred in attending a convention is set out in Interpretation Bulletin IT-131R.
The case of Morris and Gloria Michayluk, [[1988] 2 C.T.C. 2236] 88 DTC 1564, referred to in the January costs incurred 1989 CGA magazine concerned the deductibility of in attending Amway meetings both inside and outside Canada. The decision of the Tax Court of Canada in this case to allow such expenses was based on the particular facts of the case and accordingly is not considered a precedent by the Department. For example, in another case, Gary and Mary Graves, [[1983] C.T.C. 2594] 85 DTC 548 the Tax Court considered the cost of attending similar out-of-country meetings to be non-deductible. The Graves have appealed this decision to the Federal Court - Trial Division. Another appeal to the Federal Court, that of James Moses, involves the deductibility of attending one, of the meetings that was at issue in the Michayluk case. These appeals should provide jurisprudence from a higher court.
Until these cases are resolved there will be no new guidelines -relative to business meeting expenses incurred in or out of the country.
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