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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. ...

Should any other directions be given by this Court in connection with this appeal? ... SHOULD ANY OTHER DIRECTIONS BE GIVEN BY THIS COURT IN CONNECTION WITH THIS APPEAL? ...

The Queen, the Court considered the following factors in determining whether the sale of real property was income: a)   The nature of the property sold and how the taxpayer used it; b)   The length of the ownership period; c)   The frequency or number of other similar transactions by the taxpayer; d)   The work expended on or in connection with the property; e)   The circumstances giving rise to the sale of the property; and f)   The taxpayer's motive regarding the sale of the property at the time of purchase. [19]   The CRA auditor focused on the second and third factors to justify his findings. ... Work expended on or in connection with the property realized. If effort is put into bringing the property into a more marketable condition during the ownership of the taxpayer or if special efforts are made to find or attract purchasers (such as the opening of an office or advertising) there is some evidence of dealing in the property. 5. ...

If there is a causal connection between the expense and the inventory it should be included in the cost of inventory. ... Counsel considered that there was a direct causal connection between the harvesting of the logs and the cost of silviculture, therefore, it was correct to treat the silviculture cost as one related to the inventory of logs harvested and not as a period cost. ...

The context for the purpose of the interpretation of a treaty shall comprise, in addition to the text, including its preamble and annexes: (a) any agreement relating to the treaty which was made between all the parties in connexion with the conclusion of the treaty; (b) any instrument which was made by one or more parties in connexion with the conclusion of the treaty and accepted by the other parties as an instrument related to the treaty. 3. ...

(c) “Point of measurement” with respect to: (i) crude oil and crude naphtha means the production tanks, of the Lessee to which any well on the said lands is connected; (ii) absorption gasoline and/or natural gas means the point of connection with the gas gathering system connected to the well. ... (c) “Canadian resource property” of a taxpayer means any property acquired by him after 1971 that is (i) any right, licence or privilege to explore for, drill for or take petroleum, natural gas or related hydrocarbons in Canada, (ii) any right, licence or privilege to (A) store underground petroleum, natural gas or related hydrocarbons in Canada, or (B) prospect, explore, drill or mine for minerals in a mineral resource in Canada, (iii) any oil or gas well in Canada, (iv) any rental or royalty computed by reference to the amount or value of production from an oil or gas well in Canada, (v) any rental or royalty computed by reference to the amount or value of production from a mineral resource in Canada, (vi) any real property in Canada the principal value of which depends upon its mineral resource content (but not including any depreciable property used or to be used in connection with the extraction or removal of minerals therefrom), or (vii) any right to or interest in any property (other than property of a trust) described in any of subparagraphs (i) to (vi) (including a right to receive proceeds of disposition in respect of a disposition thereof); [Emphasis added.] ...

It read: 2. (1) In this Act, and in any regulations made hereunder, unless the context otherwise requires, (r) “personal and living expenses” shall include inter alia — (i) the expenses of properties maintained by any person for the use or benefit of any taxpayer or any person connected with him by blood relationship, marriage or adoption, and not maintained in connection with a business carried on bona fide for a profit and not maintained with a reasonable expectation of a profit. ... Apart from specific legislation in a taxing statute, I know of no law which imposes an obligation upon a lender to demand the payment of interest in connection with a loan granted by the lender to a borrower, and if the lender does not require the payment of interest, the borrower is under no obligation to pay interest. ...

., 2015 FCA 52 at paragraphs 3 to 6.] and therefore as a general proposition it is the facts directly or indirectly [Footnote: One example of a fact that is indirectly relevant is a fact that is relevant to credibility.] relevant to that core issue that may be explored in an oral examination for discovery. [26] With respect to the degree of connection that is required by the phrase “relevant to any matter in issue in the proceeding”, [Footnote: Subsection 95(1).] in Lehigh the Federal Court of Appeal states at paragraph 34: The jurisprudence establishes that a question is relevant when there is a reasonable likelihood that it might elicit information which may directly or indirectly enable the party seeking the answer to advance its case or to damage the case of its adversary, or which fairly might lead to a train of inquiry that may either advance the questioning party’s case or damage the case of its adversary. [27] Recently, in Madison Pacific Properties Inc. v. ... More precisely, questions that constitute a fishing expedition are not proper questions either because they are overly broad and/or an abuse of the discovery process or because they have no connection to the matters in issue in the proceeding, or both. ...