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MNR [[1985] 2 C.T.C. 2383] [1985] 2 CTC 2383 (TCC) the court considered a situation in which a closely held corporation had, throughout most of a particular year, made weekly salary payments to its president, who was also the majority shareholder. ...

Further, complications arise as GST sales made on consignment also provide for a certain leeway period before GST is considered due. ...

This position is supported at paragraph 3 of IT-417R where it states "... it is considered that the Income Tax Act always required and continues to require that all costs that could clearly be related to future periods be expensed in those periods, if they are material and if failure to defer the expense would distort the net profit not only of the year during which the expense was incurred but also of the subsequent year or years to which the benefit relates. ...

(b) Drillco may be considered a financing vehicle for Oilco in the sense that it is not commercially viable for Oilco to issue its own flow-through shares to the public given the disparity between Oilco's own net asset values and the trading price of its shares. ...

If it would, then as stated in paragraph 14(a) of IT-448, such a change in the voting rights attached to these shares would normally be considered to be of sufficient substance to be regarded as a disposition of the shares. ...

Our Comments We are not prepared to express a general opinion that payments to a third party trustee or depository will not be considered to represent obligatory payments by the borrower on the principal portion of the loan. ...

Salaries from Canadian corporations to a non-resident person will not be considered management or administration fees or charges under Part XIII (Part III) of the Act. ...

Situation 2 The facts are as follows (1) The same facts as presented in Situation 1. (2) Hotel B is acquired in the year immediately following the initial year as in hotel C which is acquired after hotel B. (3) The corporate members wish to consider hotel C as the replacement property because this hotel has a greater cost than hotel B thereby resulting in a larger deferral on capital gain than would be possible if hotel B were considered as the replacement property. ...

To succeed under this provision it is necessary to show that the doubtful debt arose from loans made in the ordinary course of business by a taxpayer part of whose ordinary business was the lending of money between XXXX Under these circumstances the loans could not likely be considered arising from loans made by the XXXX in their ordinary course of business whose ordinary business was the lending of money, unless of course the XXXX can show that they were indeed in the business of loaning money. ...

Paragraph 12 of IT439 elaborates on this statement by explaining that if a pilot plant switches to operating as a normal commercial production unit, the activity can no longer be considered scientific research. ...