Cases
Romar v. Canada, 2010 DTC 5076 [at 6816], 2009 FCA 48
Two Ontario partnerships of which the taxpayers were members paid for research to be carried out on their behalf by a Brazilian research...
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| Tax Topics - Income Tax Act - Section 37 - Subsection 37(2) | 105 |
Coppley Noyes & Randall Ltd. v. The Queen, 91 DTC 5291, [1991] 1 CTC 541 (FCTD), varied on appeal 93 DTC 5196, 5508 (FCA).
Before going on to affirm the deductibility under s. 20(1)(l) of an allowance for doubtful accounts which the taxpayer had taken for tax and...
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| Tax Topics - General Concepts - Payment & Receipt | presumed application to oldest debt | 103 |
| Tax Topics - Income Tax Act - Section 10 - Subsection 10(1) | consistent LIFO use generally is acceptable | 99 |
| Tax Topics - Income Tax Act - Section 20 - Subsection 20(1) - Paragraph 20(1)(l) | 92 |
The Queen v. Foothills Pipe Lines (Yukon) Ltd., 90 DTC 6160, [1990] 1 CTC 221 (FCA)
Because it was a question of law whether the taxpayer's obligation to effectively repay special charges which it had made to shippers in certain...
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| Tax Topics - Income Tax Act - Section 12 - Subsection 12(1) - Paragraph 12(1)(a) | 87 |
Stearns Catalytic Ltd. v. The Queen, 90 DTC 6286, [1990] 1 CTC 398 (FCTD)
Considerable weight was given to accounting evidence, to the effect that a stock of spare parts constituted fixed assets for accounting purposes...
Macmillan Bloedel Ltd. v. The Queen, 90 DTC 6219, [1990] 1 CTC 468 (FCTD)
Expert accounting evidence was found to be relevant to the application of s. 20(1)(e).
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| Tax Topics - Income Tax Act - Section 20 - Subsection 20(1) - Paragraph 20(1)(e) | loss on forward contract to lock in Canadian dollar cost of U.S.-dollar borrowing was issue expense | 191 |
| Tax Topics - Income Tax Act - Section 4 - Subsection 4(1) - Paragraph 4(1)(a) | interest on loans to customers was part of logging business | 39 |
| Tax Topics - Income Tax Regulations - Regulation 700 - Subsection 700(1) | 118 |
MHL Holdings Ltd. v. The Queen, 88 DTC 6292, [1988] 2 CTC 42 (FCTD)
After citing the Metropolitan Properties case for the proposition that GAAP "should normally be applied in tax cases unless of course there is a...
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| Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(b) - Capital Expenditure v. Expense - Improvements v. Repairs or Running Expense | 92 |
TNT Canada Inc. v. The Queen, 88 DTC 6334, [1988] 2 CTC 91 (FCTD)
Before finding that the deduction of cargo claims was prohibited by s. 18(1)(e), Cullen J. stated (p. 6338) that "the case law is clear on the...
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| Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(a) - Public Policy | 113 | |
| Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(e) | 66 |
Edmonton Plaza Hotel (1980) Ltd. v. The Queen, 87 DTC 5371, [1987] 2 CTC 153 (FCTD)
Jerome A.C.J. indicated (at p. 5375) that he had no reason to depart from the treatment of an expenditure accorded to it in the taxpayer's...
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| Tax Topics - Income Tax Act - Section 13 - Subsection 13(21) - Undepreciated Capital Cost - A | costs incurred to obtain building permit part of building cost | 108 |
| Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(b) - Capital Expenditure v. Expense - Improvements v. Repairs or Running Expense | 86 |
The Queen v. Consumers' Gas Co. Ltd., 87 DTC 5008, [1987] 1 CTC 79 (FCA)
Accounting principles for depreciable assets were found to have no particular relevance to the determination of the effect of reimbursements...
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| Tax Topics - Income Tax Act - Section 152 - Subsection 152(1) | assessment is of dollar amount | 87 |
| Tax Topics - Income Tax Act - Section 181 - Subsection 181(3) | 78 | |
| Tax Topics - Income Tax Act - Section 13 - Subsection 13(7.1) | payments made in the same manner as by private businesses were not “government assistance” | 125 |
Sears Canada Inc. v. The Queen, 86 DTC 6304, [1986] 2 CTC 80 (FCTD), aff'd 89 DTC 5039 (FCA)
An obligation of the taxpayer to make future repairs pursuant to maintenance agreements was found to be a contingent liability notwithstanding...
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| Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(e) | 166 | |
| Tax Topics - Income Tax Act - Section 20 - Subsection 20(1) - Paragraph 20(1)(m) | reserve can be for contingent amounts | 46 |
| Tax Topics - Income Tax Act - Section 20 - Subsection 20(7) - Paragraph 20(7)(a) | 68 |
The Queen v. Terra Mining & Exploration Ltd. (N.P.L.), 84 DTC 6185, [1984] CTC 176 (FCTD)
Before finding that both ss.20(1)(c) and 12(1)(c) "require accounting in conformity with ordinary commercial practices and/or generally accepted...
Cummings v. The Queen, 81 DTC 5207, [1981] CTC 285 (FCA)
In refusing to follow accounting evidence that a deduction for a future lease pick-up payment in the amount of $500,000 was a fixed liability...
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| Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(b) - Capital Expenditure v. Expense - Improvements v. Repairs or Running Expense | landlord assumption of old leases | 82 |
| Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(e) | 93 |
Lipper v. The Queen, 79 DTC 5246, [1979] CTC 316 (FCTD)
Addy J. found that the financial statements of a film promoter which had sold a film to a limited partnership failed to reflect reality and...
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| Tax Topics - General Concepts - Fair Market Value - Other | 44 | |
| Tax Topics - Income Tax Act - Section 13 - Subsection 13(21) - Undepreciated Capital Cost - A | 118 |
British Yukon Railway Co. v. The Queen, 77 DTC 5176, [1977] CTC 256 (FCTD)
Before going on to prefer the taxpayer's method (a formula developed by its accountants) for allocating income of a cross-border railway venture...
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| Tax Topics - Income Tax Regulations - Regulation 406 | 66 |
Meteor Homes Ltd. v. MNR, 61 DTC 1001, [1960] CTC 419 (Ex. Ct.)
Before finding that the deduction of sales tax liabilities of the taxpayer was not prohibited by s. 12(1)(e) of the pre-1972 Act, Kearney J....
International Nickel Co. of Canada Ltd. v. MNR, 71 DTC 5332, [1971] CTC 604 (FCTD)
Before finding that scientific research expenditures of the taxpayer were non-deductible capital expenditures notwithstanding that they were...
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| Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(b) - Capital Expenditure v. Expense - Know-How and Training | 145 | |
| Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(b) - Capital Expenditure v. Expense - Lessening of Competition | 145 | |
| Tax Topics - Income Tax Act - Section 37 - Subsection 37(1) | s. 37 permits deduction of capital expenditures on research | 114 |
| Tax Topics - Income Tax Regulations - Regulation 1204 - Subsection 1204(1) | 145 | |
| Tax Topics - Statutory Interpretation - Interpretation Act - Section 16 | 59 |
B.C. Electric Railway Co. Ltd. v. MNR, 57 DTC 1034, [1957] CTC 120, [1957] CTC 119 (Ex Ct), aff'd 58 DTC 1022, [1958] CTC 21 (SCC)
Evidence as to accounting practice could not prevail over the prohibition in s. 12(1)(b) of the pre-1972 Act against the deduction expenditures.
See Also
Barrick Gold Corporation v. The Queen, 2017 TCC 18
In finding that the treatment for accounting purposes of a gain realized by the taxpayer from closing out hedges was not relevant to whether the...
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| Tax Topics - Income Tax Regulations - Regulation 1204 - Subsection 1204(1) - Paragraph 1204(1)(b) - Subparagraph 1204(1)(b)(ii) | hedging of price of gold to be produced occurred as part of gold production business | 453 |
Ford Credit Canada Limited v. The Queen, 2006 DTC 3424, 2006 TCC 441
Before going on to find that s. 181(3) required retractable preferred shares in the capital of the taxpayer to be treated as debt for large...
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| Tax Topics - Income Tax Act - Section 181 - Subsection 181(3) | 41 | |
| Tax Topics - Income Tax Act - Section 9 - Accounting Principles | 102 |
Royal Trustco v. The Queen, 2001 DTC 52 (TCC)
Sarchuk T.C.J. indicated (at p. 64) that:
"The interpretation of the undefined terms 'tangible property' and 'reflected' in accordance with their...
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| Tax Topics - Income Tax Act - Section 181 - Subsection 181(3) | 38 | |
| Tax Topics - Income Tax Act - Section 181.3 - Subsection 181.3(1) | 169 |
Canfor Ltd. v. Minister of Finance for BC, [1976] CTC 429 (BCSC), aff'd [1977] CTC 616 (SCC), rev'g [1977] CTC 269 (BCCA)
Before considering various terms in the Corporation Capital Tax Act (BC), Fulton J. stated (pp. 431-432):
"that where a word or expression used in...
Administrative Policy
23 November 2016 Internal T.I. 2015-0618511I7 - Thin Capitalization - Retained Earnings
A Canadian subsidiary, which prepared its consolidated financial statements in accordance with IFRS, also prepared its unconsolidated financial...
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| Tax Topics - Income Tax Act - Section 18 - Subsection 18(5) - Equity Amount - Paragraph (a) - Subparagraph (a)(i) | unconsolidated balance sheet must reflect the same accounting standards applied in the consolidated financials | 307 |
Commentary
It is well accepted that generally accepted accounting principles, or other accepted business practices, may be accorded significant weight in the...