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5 November 2015 Internal T.I. 2013-0496401I7- XXIX-A(3)- Active Trade or Business Exception-- summary under Article 29A Summary Under Tax Topics- Treaties- Income Tax Conventions- Article 29A connection test in XXIX-A(3) of U.S. ... Convention that the Interest Payments be income be derived "from the other Contracting State (Canada) in connection with…that (US) trade or business" met based on a "funding approach"? ... The last two assertions rely on an interpretation of the "connection standard" that allows it to be met based on either a "use test" or a "funding approach". ...

12 May 2000 Internal T.I. 2000-0001737- EXPENSES OF REPRESENTATION-- summary under Paragraph 20(1)(cc) Summary Under Tax Topics- Income Tax Act- Section 20- Subsection 20(1)- Paragraph 20(1)(cc) OMB represenations by farming businesses included In response to an inquiry respecting the deductibility under s. 20(1)(cc) of legal costs incurred by farmers, in connection with making representations to the Ontario Municipal Board, supporting the rezoning of their farm property from rural to agricultural status, CRA stated: In our view, the Ontario Municipal Board is a municipal or public body performing a function of government. Therefore, legal fees paid, in connection with making representations to the Ontario Municipal Board, relating to a business carried on by a taxpayer, would be deductible in the year paid under paragraph 20(1)(cc) of the Act. ...

30 September 2002 Internal T.I. 2002-0152107 F- BRANCHEMENT A DES SERVICES PUBLICS-- summary under Paragraph 62(3)(g) Summary Under Tax Topics- Income Tax Act- Section 62- Subsection 62(3)- Paragraph 62(3)(g) utilities include cable, satellite TV and internet After finding that “utilities” referred to in s. 8(1)(c)(iii) did not extend to cable television services, satellite television services and internet connection services, the Directorate went on to note: [T]he expression "utilities" used in paragraph 62(3)(h) is broad enough to encompass telecommunications services such as cable television, satellite television and Internet connections. ...

17 April 2003 Internal T.I. 2003-0181507 F- PRET SANS INTERET-- summary under Subparagraph 20(1)(c)(i) Summary Under Tax Topics- Income Tax Act- Section 20- Subsection 20(1)- Paragraph 20(1)(c)- Subparagraph 20(1)(c)(i) accessing the exceptional circumstances test requires demonstrating “a sufficient connection between the interest-free loan and an indirect source of the person's income” After surveying the jurisprudence on the exceptional circumstances test, the Directorate stated: Interest deductibility in other situations involving interest-free loans by a person to a corporation of which the person is not a shareholder may be justified on the particular facts of the case, as in Canadian Helicopters … and … Byram … to the extent that the person can show that there is a sufficient connection between the interest-free loan and an indirect source of the person's income. ...

Loss loss on equity swap entered into in monetization transaction was on capital account In connection with its monetization of the shares of a corporation, the taxpayer transferred the shares of that corporation to a Newco ("Corporation2") in consideration for shares of Corporation2, entered into an equity swap with a financial intermediary with respect to the shares of Corporation2 under which it agreed to pay the appreciation in the value of the shares of Corporation2 above a ceiling level, and the counterparty agreed to pay the depreciation in value of the shares of Corporation2 below a floor level, and the taxpayer borrowed money from another financial institution. ... Given the close connection between the loan and the equity swap contract, including the fact that the amount of the loan corresponded to the floor value of the swap contract, the loss sustained by the taxpayer when the equity swap was settled was on capital account. ...

In responding negatively, the Directorate stated (TaxInterpretation translation): Our long-standing position respecting the expression services performed in connection with the sale of goods is that only services directly related to such sales so qualify. ... Words and Phrases in connection with ...

After finding that s. 95(2)(b) applied to the R&D Services provided to Canco, the Directorate rejected Canco’s argument that the R&D Services provided to Canco should be considered to be services performed in connection with the sale of goods under s. 95(3)(b), stating: [T]he phrase “services performed in connection with the (...) sale of goods” is limited to services that are directly related to the sales function …. ...

Expense- Contract or Option Cancellation cash settlement of employee stock options in connection with the privatization of the corporation was a capital expenditure After Aco had acquired control of Bco, Bco was privatized so that Aco acquired all the remining shares. ... In our opinion, the payment was being made in connection with Aco's offer to purchase all of the outstanding and issuable shares of Bco through the cancellation of the Plan. ...

Profit- Futures/Forwards/Hedges equity swap was to hedge the risk under a capital borrowing, so that loss on closing out the swap was on capital account In connection with its monetization of the shares of a corporation, the taxpayer transferred the shares of that corporation to a Newco ("Corporation2") in consideration for shares of Corporation2, entered into an equity swap with a financial intermediary with respect to the shares of Corporation2 under which it agreed to pay the appreciation in the value of the shares of Société2 above a ceiling level, and the counterparty agreed to pay the depreciation in value of the shares of Corporation2 below a floor level, and the taxpayer borrowed money from another financial institution. ... Given the close connection between the loan and the equity swap contract, including the fact that the amount of the loan corresponded to the floor value of the swap contract, the loss sustained by the taxpayer when the equity swap was settled was on capital account. ...

6 March 1995 Internal T.I. 9428767- VIDEO REPRODUCTION RIGHTS-- summary under Subsection 212(5) Summary Under Tax Topics- Income Tax Act- Section 212- Subsection 212(5) The phrase "in connection with television" would apply to video tapes destined for private home use. ...