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The King, 2023 TCC 156-- summary under Business Source/Reasonable Expectation of Profit Summary Under Tax Topics- Income Tax Act- Section 3- Paragraph 3(a)- Business Source/Reasonable Expectation of Profit no evidence to call into question the underlying assumption in Stewart that the taxpayer pursued her clearly-commercial farming venture for profit Before going on to find that the taxpayer’s losses from a cattle operation (which were substantial both in dollar terms and relative to the revenues) were deductible as business losses before consideration of the limitation on farming-loss deductions under s. 31, Owen J stated (at paras. 103-105): The assumption underlying the test in Stewart is that a commercial activity is undertaken for profit… Consequently, unless there is some reason to question this assumption in the circumstances of a particular case, an activity that is on its face clearly a commercial activity as opposed to a personal undertaking is considered a source of income. ... Noël, C.J. simply found that the transactions in Paletta had the “appearance” of being commercial but in fact were not “clearly commercial” when one considered all the circumstances. ...

If Parliament had wanted them to be considered, it would have clearly so stated in subsection 245(4) of the Act, as it has done in a number of other provisions of the Act. Furthermore, even if Reg. 1100(11) could be considered in determining whether there was an abuse, there was none, given that it is quite common for a shareholder (or partner) to borrow in order to provide capital, and given that s. 245 cannot be used by the Minister as a tool to force taxpayers to structure a transaction in a manner most favourable to the tax authorities. ...

All circumstances must be considered.... [I]t is clear that for the "purpose" test in paragraph 20(1)(c), the use of funds by the borrower subsidiaries can be considered as part of all the circumstances. ...

In particular, although the unitholders of the fund became shareholders of the taxpayer, this was considered not to entail an acquisition of control of the taxpayer by a group of persons. ... The questions included whether the Department of Finance considered making the 2010 SIFT amendments retroactive, why it had changed its explanatory notes to say that s. 256(7)(c.1) "clarified" rather than "extended" the change-of-control rules and whether the Attorney General agreed that initially the policy choice of the SIFT conversion rules was to allow the use of existing corporations. ...

Respecting his acceptance of the parol evidence, Hogan J first noted (at para. 32): Under the so-called “textualist” approach, parol evidence is admissible only in circumstances where the words or terms of the agreement are considered to be ambiguous (that is, when there is patent ambiguity). The “contextualist” approach, on the other hand, allows for the consideration of extrinsic evidence when there is latent ambiguity, thus making it possible for the factual matrix surrounding the contract at the time it was formed to be considered. ...

It is also my view that the representations were of sufficient detail such that it could reasonably be considered that a prospective purchaser could deduct the full purchase price of the Software over a two-year period. ... Krumm, IAC and its agents could each be considered to be a tax shelter “promoter”, as defined in subsection 237.1(1) …. ...

MNR, 92 DTC 1693, [1992] 1 CTC 2506 (TCC)-- summary under Paragraph 118(1)(b) Summary Under Tax Topics- Income Tax Act- Section 118- Subsection 118(1)- Paragraph 118(1)(b) Lamarre Proulx J. found that s. 118(1)(b)(ii) of the Act should be considered to be of no effect in light of s. 15 of the Charter and that it should be read as if clause D had not been enacted. ...

MNR, 90 DTC 1557, [1990] 2 CTC 2044 (TCC)-- summary under Paragraph 44(2)(b) Summary Under Tax Topics- Income Tax Act- Section 44- Subsection 44(2)- Paragraph 44(2)(b) The taxpayer's entitlement to compensation was considered to have been finally determined by a judgment of the Trial Division of the Federal Court even though a notice of appeal therefrom was subsequently filed and then discontinued. ...

The Queen, 2013 DTC 1218 [at at 1210], 2013 TCC 266 (Informal Procedure)-- summary under Subsection 118.5(1) Summary Under Tax Topics- Income Tax Act- Section 118.5- Subsection 118.5(1) piano lessons Favreau J stated (at para. 22): I do not think that a one-hour piano lesson per week is sufficient for the Appellant's son to be considered as being enrolled at an university, college, or other educational institution providing courses at a post-secondary level. ...

This would, however, imply a very marked divergence from what is considered normal. ...