Search - 江西农大 毛瑢

The appellant attempted to deduct, from its 1974 taxation year, income in the amount of $13,098 on certain insurance policies set out as follows: Sun Life $ 395 Maritime Life Re Policy 154510 $ 2,998 Maritime Life Re Policy 206223 $ 1,004 Maritime Life Re Policy 154503 $ 8,701 $13,098 In this regard, at the outset of the hearing, it was agreed by both counsel for the appellant and counsel for the respondent that deduction of the Sun Life policy premium in the sum of $395 not be allowed; that the deduction of the premium for the Maritime Life Policy number 154510 be allowed; that the deduction of the premiums for the Maritime Life policy number 206223 be allowed; leaving in dispute and in issue the deductibility of premiums paid on Maritime Life Policy number 154503. ... A letter was filed from Aetna dated February 21, 1973, addressed to the accountants for Direct Lumber which reads as follows: (Exhibit A-15) AETNA FACTORS February 21, 1973 Goldfarb, Shulman & Co., 3077 Bathurst Street, TORONTO 19, Ontario. ... JAR Leaseholds: (1) Registered General Assignment of Book Debts — Accounts receivable — Oct 31/72 — $892,629.46 (2) Personal guarantees given by: John Fabry Mrs. ...

The four directors of the Company were: David Appleby- President — 2 common shares ‘Joe Tanenbaum — Secretary-Treasurer A Freeman- Director Harold Tanenbaum — Director Eight common shares were issued to the directors and the sum of $8 for the shares was deposited in a separate bank account. ... At an average cost of US $342.67 per acre, my share of profit of land sales in 1973 should be calculated as follows: Land sales $188,000 Less — 50% allocated to Pinetree Investments Limited 94,000 $94,000 Less- 6/20th allocated to David Appleby 28,200 65,800 Less — Cost of land (14/20 x 155 acres @ $342.67) 37,180 Gross profit $28,620 Less — Expenses per financial statements 34,316 Less- 50% allocated to Pinetree Investments Limited 17,158 17,158 Less — 6/20th allocated to David Appleby 5,147 12,011 Net profit $16,609 My share of net profit is 1 /14th of $16,609 or $1,186. 5. ... On June 30, 1975, the appellant wrote the following letter to the Director of the District Taxation Office in Toronto: June 30/75 Sidney Zionce 71 Fontainbleau Dr Willowdale Ont Director — Taxation Revenue Canada Taxation 36 Adelaide St E TORONTO Ont Dear Sir: Re 1973 & 1974 income. ...

Miles to and from court 48 Miles @ 18 cents a mile X 180 Equals $ 8.64 Parking $ 1.75 Total per journey $10.39 Total court appearances X 243 Total travelling expenses $2524.77 In direct evidence and under cross-examination the appellant provided information that to the Board appears adequate and satisfactory on the major point dealing with the total of $2,524.77—how he could make 243 court appearances in one year, during his off-duty hours, while still performing his regular shift of work. ...

Medical practitioner’s automobile and telephone expenses — Farming losses. ... Dr Todd, having left British Columbia to take up residence in California, did not appear in person before the Board at the hearing of his appeal, but one Peaker, administrative officer of The R B White Clinic — and himself an orchardist — testified that he had been requested by Dr Todd to review and assess the prospects of the farm before the appellant acquired it in 1964. ... A statement filed as Exhibit R-2 discloses the treatment accorded the loss claimed as a deduction by Dr Todd to have been as follows: Claimed Allowed Disallowed Taxes and Water $ 394.06 Irrigation Water — Allow 100% of $50.00 $ 50.00 Taxes —Allow 25% of $344.06 $ 86.01 $ 258.05 Insurance (not crop insurance) 4.14 Disallow 100% Nil 4.14 Electricity 164.89 Disallow 100% Nil 164.89 Interest (on purchase of property) 1,473.31 Allow 25% 368.32 1,104.99 Simca Car Expenses and Capital Cost Allowance (Wife’s car) 341.02 Disallow 100% Nil 341.02 Dwelling Repairs & Depreciation 543.31 Disallow 100% Nil 543.31 Total Disallowance $2,416.40 Thus the total of $504.33 allowed was said to relate to wages and tree-removal costs and other matters directly related to the orchard, and bore a definite relation to the earning of such income as the orchard had been able to produce. ...

Facts 3.1 According to the respondent’s auditor, Mr Charles Raymond, an article appeared on January 7, 1975, in the newspaper “La Presse” (Exhibit 1-1) concerning certain accounts maintained under false names at the Bank Canadian National in Louiseville. 3.2 On January 24, 1975, the bank in question received from the respondent, through the Special Investigations Section, a requirement for information (Exhibit I-2) relating to individuals who might be connected with these accounts maintained under false names. 3.3 On February 24,1975, the respondent was provided with a reply (Exhibit I-3) which mentioned, among others, account No V-983 in the name of Mr Jos Paillé, whose real name was Reginald Paillé, the appellant. 3.4 On March 7,1975, the appellant made a voluntary disclosure admitting, among others, omissions from his returns for 1973 and 1974. 3.5 According to the auditor, a review of the bank account of the summary of deposits shows that all the deposits were made in cash. 3.6 The amounts added as a result of the voluntary disclosure to the income already reported by the appellant are as follows: Previous Amount Amount Added Total 1973 $62,748.69 $40,173.25 $102,921.69 1973 $53,732.92 $ 2,000.00 $ 55,732.92 3.7 The 25% penalties amounted to $3,069.87 for 1973 and $163.32 for 1974. 3.8 Following the issue of notices of assessment on February 27, 1976, notices of objection were filed on May 25, 1976. 3.9 Following the respondent’s notification of December 14, 1976, confirming the notices of assessment of February 27, 1976, an appeal was filed with the Tax Review Board on January 12, 1977 in relation to the penalty only. 4. ...

The land that had been purchased had been bought with the set intention of building a large housing complex; this would not have been detrimental to Steinberg’s operations — rather the contrary. ... Promise of sale signed August 21, 1964 Calculation of reserve according to section 85-B May 31/65— 85,649.20 x 247,000.00 = 82,316.54 257,000.00 ===== May 31/66 85,649.20 x 181,565.80 = 60,505.70 257,000.00 ===== May 31/67 85,649.20 x 150,000.00 49,989.80 257,000.00 == Confederation Life mortgage assumed Un- Initial Cost Accumulated depreciated Edifice Ferland Land Building Depreciation Balance April 3/64—Purchase $8,500.00 $239,000.00 $239,000.00 Additions 877.90 877.90 239,877.90 239,877.90 May 31/64—C.C.A. 11,950.00 11,950.00 Balance $8,500.00 $239,877.90 $11,950.00 $227,927.90 May 31/65—C.C.A. 11,396.40 11,396.40 Balance 8,500.00 239,877.90 23,346.40 216,531.50 Additions 25,439.10 25,439.10 $8,500.00 $265,317.00 $23,346.40 $241,970.60 Oct. 5/65—Sale Selling price 450,000.00 Less: Commission 15,000.00 $435,000.00 8,500.00 426,500.00 Total profit $184,529.40 Recovered in C.C.A. 23,346.40 Surplus over initial cost 161,183.00 $184,529.40 Terms of sale Selling price $450,000.00 Cash 100,000.00 Balance $350,000.00 by the purchaser 350,000.00 Place des Chênes Shopping Centre Un Un- Initial Cost Accumulated depreciated Land Building Depreciation Balance Aug. 9/63 Purchase $45,543.00 Construction 3,037.40 $305,007.65 305,007.65 48,580.40 305,007.65 305,007.65 May 31/64 C.C.A. $15,250.38 15,250.38 Balance 48,580.40 305,007.65 15,250.38 289,757.27 Additions 30,881.31 30,881.31 $335,888.96 $15,250.38 $320,638.58 May 31/65 C.C.A. 16,031.93 16,031.93 Balance 48,580.40 335,888.96 31,282.31 304,606.65 Mar. 18/66 Sale Selling price $375,000.00 48,580.40 326,419.60 Recovered in C.C.A. $21,812.95 If we analyse the statements made by the witnesses before the Board, we can see that no reliance can be put on appearances. ...

As Exhibit A-1, he filed a two-page document headed “Expenses 1978”; these expenses are as follows: Advertising and promotion: $ 50.00 Insurance (on musical instrument): 38.00 Interest (loan for van and musical equipment): 1,274.00 Maintenance and repairs: 85.00 Supplies and materials: 489.00 Office expenses: 13.00 Telephone: 25.00 Musical instruction: 192.00 Truck expenses (including: insurance —$237; engine repairs — repairs — $400; automatic transmission repair — $498, etc) 1,705.00 $3,871.00 Capital cost — $2,709.68 Additions — bass guitar, electric organ, speakers, microphones 744.47 $4,615.47 In the income tax return the Capital Cost Allowance 20, vouchers were also filed concerning the van expenses. ... Law — Analysis 4.01 Law The main sections of the Income Tax Act involved in the present case were paragraphs 18(1)(a), (h) and section 248, definition of “personal or living expenses”, which read as follows: 18. (1) General limitations. ... As he declared $675 of income (despite the fact that the actual amount received is not clear — see subparagraph (a) above). ...

American Wheelabrator & Equipment Corp v MNR, [1951] Tax ABC 345; 51 DTC 285; 8. ... Tara Exploration & Development Co Ltd v MNR, [1970] CTC 557; 70 DTC 6370; 16. MNR v Tara Exploration & Development Co Ltd, [1972] CTC 328; 72 DTC 6288; 1/7. ...

This interpretation applies to the interest earned by our company. — Moreover, our corporation maintains an office with a telephone listing and clerical staff is employed on a full time basis. — Presently our company is erecting an industrial building where our own building staff is employed. — Our company owns a large tract of land and ample current assets for development purposes. — From the foregoing, it is considered that our corporation is engaged in an active business. The Reply to Notice of Appeal sets out the contentions of the respondent: — During the 1972 taxation year, the appellant earned gross rental income amounting to $24,106.70; — The appellant did not provide its tenants with any special services; — The appellant has invested idle funds in term deposit certificates since 1964 and has never used these funds in the course of any business; — In the 1972 taxation year, the appellant earned interest income amounting to $29,874.48 from the investment of idle funds amounting to $335,000; — The appellant was not engaged in any money lending business during the 1972 taxation year; — The interest and the rental income earned by the appellant during the 1972 taxation year represented income from property; — The interest and the rental income earned by the appellant during the 1972 taxation year did not result from the carrying on of an active business. ... In pointing up the nature of the income — rentals and interest — as opposed to the source of the funds, and the powers of the corporation, the respondent has highlighted the main difference between his views and those of the appellant. ...

For the respondent: — The amount of $100,000* was set up as a liability and deducted as an expense in order to reduce the total amount of taxes payable by the appellant: (*The amount at issue in the appeal, the total was $110,000) — There was no contract or agreement between the appellant and the persons to whom the alleged bonus was owing and a bonus would be paid; — There was no contract of employment between the appellant and any person who was within the management category requiring the payment of the stated bonus; — With respect to the bonuses no expense was made or incurred for the purpose of gaining and producing income for the businesses; — The claim of the bonus expense, if it has been found to have been made or incurred unduly or artificially reduces the income of the appellant; — The appellant did not intend to create a legal obligation to pay the bonuses; — The claim of bonus payable as an expense was in effect a reserve which is not permitted by the Income Tax Act. Evidence Mr Edward R Easton, president of the appellant company, and Mr David Staley, CA, of Smith, Flynn, Staley & Co, testified for the appellant. ... However, there were certain critical factors introduced: — the financial statements for previous years indicated a similar process of “bonus” accrual had regularly taken place; the 1976 financial statements showed in part: Revenue $1,049,301.20 Expenses 794,376.62 Profit before undernoted $ 254,924.58 Add — Gain on sale of fixed assets 150,936.00 $ 405,860.58 Less — Management bonus 110,000.00 $ 295,860.58 — Mr Staley noted that it was the business policy of his firm that clients reduce corporate profits by the utilization of such accrued management bonuses where and when it was advantageous, so that such an accrual would bring the net taxable profit from active business below the small business limit. ...