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In this connection s. 3(2)(c)(i) refers to the Income Tax Act, which has long provided in s. 251(1): first, that "related persons" are deemed not to be dealing with each other at arm's length when they enter into a contract, "related persons" being taken to mean (according to s. 251(2)):      251. (2) For the purposes of this Act, "related persons", or persons related to each other, are      (a)      individuals connected by blood relationship, marriage or adoption;      (b)      a corporation and          (i)      a person who controls the corporation, if it is controlled by one person,          (ii)      a person who is a member of a related group that controls the corporation, or          (iii)      any person related to a person described in subparagraph (i) or (ii); and     ...      251. (2) Aux fins de la présente loi, des "personnes liées" ou des personnes liées entre elles, sont      a)      des particuliers unis par les liens du sang, du mariage ou de l'adoption;      b)      une corporation et          (i)      une personne qui contrôle la corporation si cette dernière est contrôlée par une personne,          (ii)      une personne qui est membre d'un groupe lié qui contrôle la corporation, ou          (iii)      toute personne liée à une personne visée au sous-alinéa (1) ou (ii);         ... and, second, that "unrelated" persons may occasionally be regarded as not dealing at arm's length in view of the special conditions in which their dealings took place. 4 So the legislative technique is different from what it was previously, in that the exclusion does not apply to the spouses directly but to all persons who are "related"; however, because of the presumption established by s. 251(2)(a) of the Income Tax Act, the exclusion relating to the spouses remains the same, unless an exception to the peremptory nature of the presumption is adopted. ... However, in a recent judgment this Court undertook to reject that approach, and I take the liberty of citing what I then wrote in this connection in the reasons submitted for the Court: 9          The Act requires the Minister to make a determination based on his own conviction drawn from a review of the file. ...

Paragraph 8(1)(f) sets forth deductions that may be made by an employee whose employment is in connection with the selling of property or the negotiating of contracts. ... (f) 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 (i) [...] ...

If this had not been the case, US and Foreign Investors in Blackstone Capital Partners would have incurred Canadian tax in connection with that sale. The Co-Investors have also incurred, undoubtedly, significant legal costs in connection with the establishment of the revised structure. [26]   Alta Canada carried out the development of its Working Interest in the Duvernay Formation in Northern Alberta (the Kaybob area of Alberta). ...

Evidence relating to taxpayer information Communication de renseignements dans le cadre d’une procédure judicaire (2) Notwithstanding any other Act of Parliament or other law, no official or other representative of a government entity shall be required, in connection with any legal proceedings, to give or produce evidence relating to any taxpayer information. (2) Malgré toute autre loi ou règle de droit, nul fonctionnaire ou autre représentant d’une entité gouvernementale ne peut être requis, dans le cadre d’une procédure judiciaire, de témoigner, ou de produire quoi que ce soit, relativement à un renseignement confidentiel. ... Evidence relating to confidential information Communication de renseignements dans le cadre d’une procédure judicaire (3) Despite any other Act of Parliament or other law, no official or other representative of a government entity shall be required, in connection with any legal proceedings, to give or produce evidence relating to any confidential information. (3) Malgré toute autre loi fédérale et toute règle de droit, nul fonctionnaire ou autre représentant d’une entité gouvernementale ne peut être requis, dans le cadre d’une procédure judiciaire, de témoigner, ou de produire quoi que ce soit, relativement à un renseignement confidentiel. ...

The Tax Court of Canada’s Decision [30]   After setting out the relevant facts, the contextual background, the parties’ positions and his key factual findings, the Judge framed the principal issues before him as follows (at paragraphs 47 and 48 of his reasons): [47] Is the amount claimed by the Appellant in connection with the Key Transactions deemed to be interest under subsection 16(1) of the ITA? ... Hence, the expenses incurred by Amoco in connection with the aforesaid agreements did not constitute running expenses and that “[t]his is particularly true with respect to the Appellant’s undertaking to Encor to repay $225 million owed to APCJ under the exploration loan instead of Encor” (Reasons, paragraph 31). [34]   Second, the Judge stated that the appellant had not been entirely candid in response to questions in discovery about the treatment of the Key Transactions in its financial records. ...

In this regard, consequential adjustments shall include the recognition of any capital gains or capital losses arising from the actual or deemed disposition of limited partnership units of AFS 7 … as described in paragraphs (e) and (f) above. [8] [Emphasis added.] [9]   Paragraphs (c) and (h) of section 5 (in the case of AFS 9) and paragraphs (c) and (h) of section 1 (in the case of AFS 11) of the Minutes contained similar provisions for 1998 and 1999. [10]   Section 8 of the Minutes provided that the Settlement was subject to the following conditions (which are paraphrased below): (a)   the Units owned by the Accepting Limited Partners were required to represent at least 75% of the total number of Units owned by the Qualifying Partners who were not deceased, bankrupt or non-residents of Canada; and (b)   each Accepting Limited Partner was required to provide to the CRA a waiver of the right to object or appeal under subsection 165(1.2) or 169(2.2) of the ITA, as the case may be, in respect of the adjustments contemplated by the Minutes. [9] [11]   Section 12 of the Minutes stated: For greater certainty and subject to any applicable limitation periods contained in the ITA, the terms of these Minutes of Settlement do not preclude the Minister of National Revenue from redetermining any expense or amount not expressly addressed by these Minutes in respect of Qualifying Partners, provided that such redetermination does not create a result that is inconsistent with the express terms of these Minutes. [10] [12]   On or about February 16, 2012, the Firm sent to the president of the General Partner of each of the Partnerships several memoranda, which were dated February 16, 2012 and which summarized the settlement offer (the “Settlement Offer”) that had been received from the CRA. [11] The Firm indicated that it was still working with the DoJ and the CRA “to fine tune some of the specific language of the Settlement Offer.” [12] The Firm also stated that similar offers were being provided by the CRA to the other Limited Partners who had been reassessed. [13]   The Firm’s memorandum of February 16, 2012 in respect of AFS 7 stated: Under the Settlement Offer, CRA will: (i)   allow slightly more than 78% of all operating expenses claimed by Alliance 6 in 1995 and 1996 which were allocated to the limited partners; [13] (ii)   allow 100% of all other expenses incurred by AFS 7 and Alliance 7 [sic] that were allocated to the limited partners; [14] and (iii)   allow 100% of all of the interest and financing charges incurred directly by the limited partners in connection with the investment in AFS 7. [15] The Firm’s memoranda of February 16, 2012 in respect AFS 9 and AFS 11 contained similar statements, except that the percentage stated in item (i) was 75.8% in the AFS 9 memorandum and 79% in the AFS 11 memorandum. [14]   On June 19, 2012, Mr.  ... In addition, subparagraphs 2(iii) to (v) of each Waiver stipulated that the CRA was to reassess him as follows: (iii)   allows all interest expense and carrying charges previously claimed by me in respect of the Partnership in any taxation year in which I have filed an objection or an appeal or which is otherwise open for reassessment; (iv)   allows any consequential claims by me for the carryforward or carryback of any losses resulting from the reassessments as set forth above; and (v)   unless otherwise agreed to by me, does not make any other adjustment to my tax liability in connection with my investment in, or ownership of, limited partnership units of the Partnership other than consequential adjustments or other adjustments that are not expressly addressed by, and do not create a result that is inconsistent with, any of the preceding terms of the Waiver. [17] [15]   While the Minutes and the Waivers specifically discussed the deductibility of the deductions claimed by Mr. ...

They import such meanings as ‘in relation to’, ‘with reference to’ or ‘in connection with’. The phrase ‘in respect of’ is probably the widest of any expression intended to convey some connection between two related subject matters. [53] [74]   This definition was applied to provide retroactive liability in the context of a section 160 assessment in Mario Côté Inc. v. ...

He said that he paid for all his own airfare, travel, and accommodation in connection with all of these meetings and that he would often pay these costs for Global staff or outside advisors that he needed to bring to the meetings. [12]   According to the Appellant, all of Global’s account executives would pay for business travel and client entertainment expenses with their personal credit cards and Global would reimburse them for these amounts. [13]   At the time the Appellant submitted the expenses for reimbursement, the expenses were separated according to the client to whom he said the expense related. ... Counsel maintained that there is overwhelming evidence that Global received value from the Appellant for the reimbursements since all expenses for which the Appellant was reimbursed were incurred in connection with Global’s business activities. ...

Advertising & promotion $731   Total expenses for income tax purposes $349,806 $45,126   2010 2009 Interest & bank charges $164 $20 Office expenses $128 $1,006 Professional fees $1,140 $5,500 Salaries & wages $273,906 $38,000 Vehicle $8,601 $600 Commissions $66,719   Less non-deductible expenses ($1,583) ($0)       (t) In issuing the Reassessments, the Minister disallowed the following expenses claimed by Arora in its 2009 and 2010 taxation years:   2010 2009 Advertising & promotion $731   Interest & bank charges $164 $20 Office expenses $128 $1,006 Professional fees $1,140 $5,500 Salaries & wages $0 $0 Vehicle $8,601 $600 Commissions $0   Less non-deductible expenses ($1,583) ($0) Total expenses for income tax purposes $9,181 $7,126       (u) In issuing the Reassessments, the Minister allowed the following expenses claimed by Arora in its 2009 and 2010 taxation years:   2010 2009 Advertising & promotion $0   Interest & bank charges $0 $0 Office expenses $0 $0 Professional fees $0 $0 Salaries & wages $273,906 $38,000 Vehicle $0 $0 Commissions $66,719   Less non-deductible expenses ($0) ($0) Total expenses for income tax purposes $340,625 $38,000   LAW AND ANALYSIS [9]   Subsection 125(1) of the Act [10] provides that a CCPC, in computing its tax payable under the Act, may (in specified circumstances) claim a small business deduction in respect of its income from an “ active business carried on in Canada ”. [10]     “ Active business carried on by a corporation ” [11] is defined in subsection 125(7) as follows: “active business carried on by a corporation” means any business carried on by the corporation other than a specified investment business or a personal services business and includes an adventure or concern in the nature of trade; [emphasis added] [11]   “ Active business ” is also defined in subsection 248(1) as follows: “active business”, in relation to any business carried on by a taxpayer resident in Canada, means any business carried on by the taxpayer other than a specified investment business or a personal services business;  [emphasis added] [12]   “ Business ” is defined broadly in subsection 248(1) as follows: “business” includes a profession, calling, trade, manufacture or undertaking of any kind whatever and, except for the purposes of paragraph 18(2)(c), section 54.2, subsection 95(1) and paragraph 110.6(14)(f), an adventure or concern in the nature of trade but does not include an office or employment; [emphasis added] [13]   As defined, the definition of both “ active business ” in subsection 248(1) and “ active business carried on by a corporation ” in subsection 125(7) specifically exclude a “ personal services business ”, which is defined in subsection 125(7) as follows: “personal services business” carried on by a corporation in a taxation year means a business of providing services where (a) an individual who performs services on behalf of the corporation (in this definition and paragraph 18(1)(p) referred to as an “incorporated employee”), or (b) any person related to the incorporated employee is a specified shareholder of the corporation and the incorporated employee would reasonably be regarded as an officer or employee of the person or partnership to whom or to which the services were provided but for the existence of the corporation, unless (c) the corporation employs in the business throughout the year more than five full-time employees, or (d) the amount paid or payable to the corporation in the year for the services is received or receivable by it from a corporation with which it was associated in the year; [emphasis added] [14]   I also note that paragraph 18(1)(p) provides as follows: 18(1) In computing the income of a taxpayer from a business or property no deduction shall be made in respect of … (p) an outlay or expense to the extent that it was made or incurred by a corporation in a taxation year for the purpose of gaining or producing income from a personal services business, other than (i) the salary, wages or other remuneration paid in the year to an incorporated employee of the corporation, (ii) the cost to the corporation of any benefit or allowance provided to an incorporated employee in the year, (iii) any amount expended by the corporation in connection with the selling of property or the negotiating of contracts by the corporation if the amount would have been deductible in computing the income of an incorporated employee for a taxation year from an office or employment if the amount had been expended by the incorporated employee under a contract of employment that required the employee to pay the amount, and (iv) any amount paid by the corporation in the year as or on account of legal expenses incurred by it in collecting amounts owing to it on account of services rendered that would, if the income of the corporation were from a business other than a personal services business, be deductible in computing its income; [emphasis added] [15]   Based on the foregoing, it is clear that a corporation which carries on a “ personal services business ” in a taxation year cannot claim the small business deduction for that taxation year and the expenses which it may claim for that taxation year are restricted to those permitted pursuant to paragraph 18(1)(p). [16]   As previously noted, in this case the Minister determined that Arora was carrying on a “ personal services business ” in both its 2009 and 2010 taxation years. ... Appendix “A” Legislation The statutory references in this schedule are to provisions of the Income Tax Act in force for the 2009 and 2010 taxation years. 18(1) General limitations — In computing the income of a taxpayer from a business or property no deduction shall be made in respect of … (p) limitation re personal services business expenses — an outlay or expense to the extent that it was made or incurred by a corporation in a taxation year for the purpose of gaining or producing income from a personal services business, other than (i) the salary, wages or other remuneration paid in the year to an incorporated employee of the corporation, (ii) the cost to the corporation of any benefit or allowance provided to an incorporated employee in the year, (iii) any amount expended by the corporation in connection with the selling of property or the negotiating of contracts by the corporation if the amount would have been deductible in computing the income of an incorporated employee for a taxation year from an office or employment if the amount had been expended by the incorporated employee under a contract of employment that required the employee to pay the amount, and (iv) any amount paid by the corporation in the year as or on account of legal expenses incurred by it in collecting amounts owing to it on account of services rendered that would, if the income of the corporation were from a business other than a personal services business, be deductible in computing its income; 125(1) Small business deduction — There may be deducted from the tax otherwise payable under this Part for a taxation year by a corporation that was, throughout the taxation year, a Canadian-controlled private corporation, an amount equal to the corporation’s small business deduction rate for the taxation year multiplied by the least of (a) the amount, if any, by which the total of (i) the total of all amounts each of which is the income of the corporation for the year from an active business carried on in Canada (other than the income of the corporation for the year from a business carried on by it as a member of a partnership), and (ii) the specified partnership income of the corporation for the year exceeds the total of (iii) the total of all amounts each of which is a loss of the corporation for the year from an active business carried on in Canada (other than a loss of the corporation for the year from a business carried on by it as a member of a partnership), and (iv) the specified partnership loss of the corporation for the year, (b) the amount, if any, by which the corporation’s taxable income for the year exceeds the total of (i) 10/3 of the total of the amounts that would be deductible under subsection 126(1) from the tax for the year otherwise payable under this Part by it if those amounts were determined without reference to sections 123.3 and 123.4, (ii) 10/4 of the total of the amounts that would be deductible under subsection 126(2) from the tax for the year otherwise payable under this Part by it if those amounts were determined without reference to section 123.4, and (iii) the amount, if any, of the corporation’s taxable income for the year that is not, because of an Act of Parliament, subject to tax under this Part, and (c) the corporation’s business limit for the year.   125(7) Definitions — In this section, … “active business carried on by a corporation” means any business carried on by the corporation other than a specified investment business or a personal services business and includes an adventure or concern in the nature of trade; … “personal services business” carried on by a corporation in a taxation year means a business of providing services where (a) an individual who performs services on behalf of the corporation (in this definition and paragraph 18(1)(p) referred to as an “incorporated employee”), or (b) any person related to the incorporated employee is a specified shareholder of the corporation and the incorporated employee would reasonably be regarded as an officer or employee of the person or partnership to whom or to which the services were provided but for the existence of the corporation, unless (c) the corporation employs in the business throughout the year more than five full-time employees, or (d) the amount paid or payable to the corporation in the year for the services is received or receivable by it from a corporation with which it was associated in the year;   248(1) Definitions — In this Act, … “business” includes a profession, calling, trade, manufacture or undertaking of any kind whatever and, except for the purposes of paragraph 18(2)(c), section   54.2, subsection 95(1) and paragraph   110.6(14)(f), an adventure or concern in the nature of trade but does not include an office or employment;   CITATION: 2019 TCC 98 COURT FILE NO.: 2015-5258(IT)G STYLE OF CAUSE: ARORA TRADING LTD. ...

It was incorporated in connection with a proposal to teach First Nations how to do mobile spill-site remediation along pipeline rights-of-way. ... He was creating a business, not expanding an existing operation. [59]   Rio Tinto was concerned with expenses incurred by a large public company which had statutory obligations requiring it to incur expenses in connection with an acquisition and related divestiture. ...