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In doubting that it followed from this that the $80,000 portion of the cash deposited was to be considered as an asset used principally in an active business carried on by Opco for purposes of (c)(i) of the QSBCS definition, CRA referred to the Ensite decision, and then stated: In determining whether cash (cash on hand, short-term investments, etc.) can be considered to be an asset used principally in an ABCO [active business carried on] the test is not to compare the total amount of such cash with the potential expenses that the corporation may incur in the coming years, but rather to determine whether its withdrawal could have a destabilizing effect on the business’s operations or whether its holding is necessary to satisfy a condition that must be met before engaging in commercial activities. … [A] permanent accumulation of cash in excess of a company's reasonable needs for working capital will generally not be considered to be an asset used principally in an ABCO. ...

31 October 2019- 12:23am CRA indicates that a taxpayer can make a voluntary disclosure where it twigs to the issue as a result of being charged for HST by a CRA-assessed 3rd party Email this Content CRA’s Memorandum on the GST/HST voluntary disclosure program states that a VDP application will not be considered voluntary if “enforcement action … relating to the subject matter of the VDP application has been initiated … against a third party, where the purpose and impact of the enforcement action against the third party are sufficiently related to the present application.” Regarding a situation where an unrelated supplier (Sco) had been supplying goods for resale to its customer (Aco), neither had been charging GST/HST based on what CRA would regard as a misinterpretation of a place-of-supply rule (in ETA s. 144), and Aco discovered this CRA view when CRA assessed Sco, who then charged the GST/HST to Aco, CRA stated: [I]f Aco and Sco are not related, the application from Aco would likely be considered under VDP. Conversely, if Aco and Sco are related companies, Aco’s application would not be considered as voluntary due to the prior enforcement action (audit) that was conducted against Sco …. ...

CRA stated: It is a question of fact whether a virtual medical service is considered rendered at the location of the health care professional, the location of the patient, or both. ... Each of these requirements must be considered before a determination can be made. ... Accordingly, this interpretation does not illuminate the question as to whether a professional working outside Canada can be considered to be rendering services in Canada to Canadian clients for purposes of Reg. 105. ...

Would any portion of the payments made by BCO to ACO for ACO's services be considered exploration and development overhead expense (CEDOE) so that such portion would be excluded from Canadian exploration expense (CEE) pursuant to ITA s. 66(12.6)(b) and Reg. 1206(4.2) and, thus, could not be renounced by BCO to its flow-through share investors? ... Regarding whether certain non-insurable risks and liabilities (e.g., losses if the survey aircraft crashed) could be considered to be “costs incurred” for these purpose, CRA noted that the “Courts have held that a taxpayer will not be considered to have incurred an expense unless and until the taxpayer has an absolute and unconditional legal obligation to pay an amount” and indicated that It seemed unlikely that such amounts could so qualify. ...

CRA considered that this payment would be a retiring allowance (and thereby presumably excluded from CPP contribution requirements) except for the amount paid in excess of the equivalent of 20 days, which generally would be considered to be employment income given that this excess, in the absence of the termination, would have been paid out to the employee at the end of the year. ...

In order for the taxpayer to be considered to have undertaken the activity in pursuit of profit, i.e. to be considered to be carrying on business, the artistic or literary endeavours must be carried on in a sufficiently commercial or business-like manner. ... A gift of art by a visual artist will be considered to be on income account if the artist created the work with the intention of selling it, but instead donated it- whereas gifts of items such as original manuscripts, letters, memoranda, or similar papers would generally be considered to be of capital property. ...

For tax purposes, a bare trust is considered a non-entity in the sense that a beneficiary as principal, is considered to deal directly with property through the trustee as agent or nominee. ...

Turning to the 12-month test therein, CRA indicated that the two work segments might very well be considered as a single unit, in which case the non-resident would be considered to have a Canadian permanent establishment if the work on the first segment commenced more than 12 months before the completion of the second segment. ...

In the situation where the will bequeathed the Property to a testamentary trust, CRA considered that: [T]o the extent that the testamentary trust is, under applicable private law, a beneficiary of the estate at the time of the transfer or distribution of the Property by the estate, the testamentary trust could be considered a beneficiary or a person beneficially interested in the estate of the deceased individual for the purposes of subsection 70(3). ...

8 May 2018- 12:16am CRA considers that a s. 16.1 election does not cause a leased property to be a capital property Email this Content The operation of the ETA input tax credit rules can turn on whether the registrant is considered to have acquired a “capital property,” largely as defined for ITA purposes. ... CRA noted the general principle in this regard that generally a registrant is not considered to have acquired property for ITC purposes unless ownership of the property has been transferred to it. ...