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26 November 2008 External T.I. 2008-0280801E5- Deductibility of Settlement and Related Legal Fees Unedited CRA Tags 9 18(1)(a) Principal Issues: Whether settlement payments made by a farmer for property damage and personal injury suffered in connection with a tractor-vehicle collision are deductible from business income. ... You asked for our comments regarding whether a settlement payment made by a farmer for property damage and personal injury suffered in connection with a tractor-vehicle collision is a deductible business expense. ...

Subsection 56(3) provides an exemption for scholarship, fellowship or bursary amounts received by an individual in connection with the individual's enrolment at a designated educational institution (e.g., a university or college) in a program in respect of which the individual may claim the education tax credit (ETC). ... Subsection 56(3) was also recently amended by the above-mentioned Bill C-28 to provide an annual exemption for a scholarship or bursary received by an individual in connection with the individual's enrolment in an elementary or secondary school. ...

Reasons: Paragraph 8(1)(f) of the Act provides for a deduction from income, "where the taxpayer was employed in the year in connection with the selling of property or negotiating of contracts for the taxpayer's employer, and....amounts expended by the taxpayer in the year for the purpose of earning the income from the employment (not exceeding the commissions or other similar amounts referred to in subparagraph (iii) and received by the taxpayer in the year) to the extent that those amounts were not... ... Our Comments Paragraph 8(1)(f) of the Act provides for a deduction from income, "where the taxpayer was employed in the year in connection with the selling of property or negotiating of contracts for the taxpayer's employer, and....amounts expended by the taxpayer in the year for the purpose of earning the income from the employment (not exceeding the commissions or other similar amounts referred to in subparagraph (iii) and received by the taxpayer in the year) to the extent that those amounts were not... ...

In connection with the XXXXXXXXXX employment, the individual moved from XXXXXXXXXX and claimed moving expenses of $XXXXXXXXXX (the individual earned employment income of $XXXXXXXXXX prior to leaving Canada). ... In connection with the position, the Individual moved from XXXXXXXXXX and claimed moving expenses of $XXXXXXXXXX which were allowed when the Individual’s 1996 return was assessed. ...

Principal Issues: Enquiry in connection with the taxability of amounts received from a RRIF or a mutual fund. ... Nevertheless, we offer the following general comments in connection with your request which we hope is of assistance to you. ...

Reasons FOR POSITION TAKEN: Interpretation of the Law and position adopted is consistent with previous pronouncements in connection with this matter (March 25, 1998- file # 5-972840, April 24, 1995- file # 5-942771, August 5, 1993 file # 5-931919, November 14 1989 file # 74376A). ... Nevertheless, we offer the following general comments in connection with your request which we hope is of assistance to you. ...

Moreover, this position is consistent with previous pronouncements in connection with this issue (see for example, file # 960854, file # 940645, file # 5-5970 and Technical News # 3 page 6). ... Nevertheless, we offer the following general comments in connection with your request which we hope is of assistance to you. ...

Furthermore, it is our view that the term "in connection with television" as used in subsection 212(5) is very broad and would apply to videotapes destined for private home use. ... Income Tax Convention; the said payments representing copyright royalties in respect of the reproduction of any literary, dramatic, musical or artistic work other than in respect of motion pictures and works on film, video tape or other means of reproduction for use in connection with television broadcasting. ...

Similarly, the OETC enables Canadian employers to reduce their employment costs with respect to foreign contract work, while maintaining the after-tax value of the remuneration their employees receive in connection with such work. ... -The "specified employer" must be carrying on business outside Canada in connection with resource, construction, installation, agricultural or engineering contracts. ...

There is no direct connection between the payor's income and the periodic payments of alimony and maintenance and, therefore, the tax status of the payor's income is not a factor relevant in determining whether alimony and maintenance income received should be exempt. ... In our view, there is no direct connection between the payor's income and the periodic payments of alimony and maintenance and, therefore, the tax status of the payor's income is not a factor relevant in determining whether alimony and maintenance income received should be exempt. ...