Teskey
J.T.C.C.:
—
The
appellant
appeals
his
assessments
of
income
tax
for
the
years
1992
and
1993
and
elected
to
have
them
heard
pursuant
to
the
informal
procedure.
The
issues
before
me
is
whether
the
Appellant
had
a
reasonable
expectation
of
profit
from
his
Amway
activities
in
1992
and
1993
and
if
he
did
were
some
of
his
expenses
personal
or
living
expenses
and
were
they
reasonable
pursuant
to
section
67
of
the
Income
Tax
Act.
Linden
J.A.
said
in
the
recent
Federal
Court
of
Appeal
decision
of
Tonn
v.
R.,
[1996]
1
C.T.C.
205,
96
D.T.C.
6011:
Other
cases
utilize
the
Moldowan
case
in
what
appear
to
be
regular
commercial
type
situations
exist.
The
facts,
of
course,
are
always
of
importance
in
sorting
out
which
cases
will
be
placed
on
the
other
side
of
the
line.
Hence,
where
a
commercial
enterprise
is
operated
at
a
loss
in
order
to
generate
tax
refunds
or
other
such
tax
consequences,
the
Court
will
likely
find
that
the
enterprise
is
not
a
business
under
the
Moldowan
test.
In
other
situations,
the
Court
may
decide
that,
though
the
taxpayer
genuinely
intend
the
pursuit
of
profit
through
a
purely
commercial
activity,
the
intention
was
unrealistic,
the
expectation
of
profit
unreasonable,
and
hence,
the
activity
was
not
a
business.
This
was
the
situation
before
this
Court
in
Landry
v.
Q.
..
Neither
the
Appellant
nor
his
wife
have
given
me
any
evidence
upon
which
I
could
base
a
finding
of
a
reasonable
expectation
of
profit
in
the
future.
I
am
driven
to
the
conclusion
that
if
it
was
not
for
the
$47,975
annual
salary
as
a
school
teacher
this
adventure
would
never
have
started
and
at
best
be
discontinued
after
the
first
year.
The
Appellant
did
not
bring
into
Court
his
1994
nor
his
1995
financial
statements
for
cross-examination
or
review.
Both
apparently
showed
further
losses.
Without
some
satisfactory
evidence
to
base
a
finding
of
profit
I
must
conclude
that
the
Appellant’s
dreams
are
just
that.
The
Appellant
paid
to
his
wife
in
1992
-
$456.00
in
wages
on
sales
of
$463.54
yet
in
1993
he
paid
her
$3,485.00
on
sales
of
$1,010.00.
The
reason
given
was
that
this
could
be
written
off
his
teacher’s
income.
1992
was
the
Appellant’s
second
year
in
the
Amway
business.
There
is
no
evidence
before
me
that
would
allow
me
to
separate
the
personal
or
living
expenses.
If
I
had
been
convinced
that
there
was
a
reasonable
expectation
of
profit
I
would
have
found
that
the
vast
majority
of
the
expenses
as
claimed
were
unreasonable.
The
appeals
are
dismissed.
Appeals
dismissed.
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