Subsection 141(1) - Use in Commercial Activities
Guide for Providers of Financial Services under "Input Tax Credits" - "Calculation Rules"
Substantially all is interpreted to mean 90% or more.
Subsection 141(3) - Use in Other Activities
FP Newspapers Inc. v. The Queen, 2013 TCC 44 (Informal Procedure)
The registrant, which was the corporate successor to an income fund, acquired, as essentially its only asset, a 49% limited partnership interest in a partnership that carried on a newspaper business. It appealed the denial of $5,039.77 in ITCs which it had claimed in its return for its three-month reporting period ending on March 31, 2011 in connection with various of its costs including fees paid in connection with the income fund conversion and in connection with news releases regarding its dividends.
Pizzitelli J. found, before turning to s. 272.1., that all of the the registrant's consumption or use of services was deemed by s. 141(3) to be not in the course of commercial activities, given that it received substantial partnership drawings ($3,865,500 for a six-month period) for distribution it to shareholders, and its only identified commercial activity in that period was providing advice to the partnership for fees of $1,212.75), and stated (at para. 19) that:
the case law is clear...that "substantially all" means at least 90% and in the case at hand we are almost at 100%.
|Locations of other summaries||Wordcount|
|Tax Topics - Excise Tax Act - Section 123 - Subsection 123(1) - Financial Service||partnership draws represented financial services||90|
|Tax Topics - Excise Tax Act - Section 272.1 - Subsection 272.1(2)||s. 272.1 did not apply to limited partner||260|