(a)-(c)

Paragraph 12(1)(a) - Services, etc., to be rendered

Cases

The Queen v. Foothills Pipe Lines (Yukon) Ltd., 90 DTC 6160, [1990] 1 CTC 221 (FCA)

The taxpayers, which had incurred various expenses in respect of the second phase of a pipeline project which had not yet been constructed, were...

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Locations of other summaries Wordcount
Tax Topics - General Concepts - Accounting Principles 40

The Queen v. Imperial General Properties Ltd., 85 DTC 5045, [1985] 1 CTC 40 (FCA)

Since s. 12(1)(a)(ii) covers deposits, s. 12(1)(a)(i) was not intended to apply to deposits. Deposits received by a vendor of land were subject to...

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See Also

Demeterio v. The Queen, 2011 DTC 1148 [at 788], 2011 TCC 192

The taxpayer earned commissions on his sale of life insurance policies, which he had to repay if the policies were cancelled within two years. ...

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Sussex Square Apartments Ltd. v. R., 99 DTC 443, [1999] 2 CTC 2143 (TCC), aff'd 2000 DTC 6548, [2000] 4 CTC 203, Docket: A-40-99 (FCA)

The taxpayer, which carried on the business of leasing real property, was the lessee of all but one suite in six three-storey apartment buildings....

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Locations of other summaries Wordcount
Tax Topics - General Concepts - Effective Date Dale principle did not apply to "contractually agreed ... revisionism" 212
Tax Topics - General Concepts - Stare Decisis 40

Anderson v. MNR, 72 DTC 1263, [1972] CTC 2318 (T.R.B.)

The Prairie Grain Advance Payments Act (Canada) enabled prairie farmers to receive cash for their threshed grain in advance of the physical...

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Dartmouth Developments Ltd. v. MNR, 67 DTC 551, [1967] Tax A.B.C. 780

A developer entered into an agreement with a purchaser of its building lots under which the purchaser (a builder) paid $120,000 to the taxpayer in...

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Administrative Policy

6 February 2015 Internal T.I. 2015-0566681I7 F - Redevances perçues d'avance

In order that the non-capital losses of Lossco would not expire, an affiliated licensee of a licence to manufacture and sell a product made a...

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Words and Phrases
royalty
Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 9 - Timing lump sum irrevocable prepayment of contingent future royalties fully included 239

10 October 2014 APFF Roundtable, 2014-0538131C6 F - revenus d'achats intégrés

A taxpayer who makes In-App sales of life or experience points to gamers has a full inclusion at the point of sale. CRA stated (TaxInterpretations...

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Tax Topics - Income Tax Act - Section 20 - Subsection 20(1) - Paragraph 20(1)(m) no reserve for extended use by purchasers of in-apps 136

2 April 2013 External T.I. 2013-0475571E5 - Life insurance

In accordance with Destacamento and Demeterio, CRA found several bases on which a self-employed taxpayer's life insurance sales commissions must...

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29 January 2010 Internal T.I. 2009-0339541I7 F - Inclusion au revenu et provision

Corporation A, which is involved in the distribution, warehousing, handling, and packaging of goods, invoices and receives revenue currently for...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 20 - Subsection 20(1) - Paragraph 20(1)(m) reserve available for future goods handling services to be performed 106
Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(a) - Incurring of Expense no deduction from prepaid fees of estimated cost of performance 94

23 September 2003 External T.I. 2002-0172175 F - Arrangements Funérailles - Provision 20(1)m)

Regarding the 10% portion of prepaid funeral amounts which a Quebec funeral home is permitted to use in its operations rather than being required...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 20 - Subsection 20(1) - Paragraph 20(1)(m) portion of prepaid funeral amount which the funeral home can use in its operations is income under s. 9, not s. 12(1)(a), for which no s. 20(1)(m) reserve can be claimed 178

7 July 2003 External T.I. 2001-0091415 F - Income & Losses from Bus. or Prop. Sec. 9 ITA

A funeral home (“Opco”) granted 99-year concessions to “Buyers” of a niche or crypt located in a columbarium or mausoleum in consideration...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 20 - Subsection 20(1) - Paragraph 20(1)(m) prepaid crypt fees of funeral home were ineligible for s. 20(1)(m) reserve 127

25 March 1999 Internal T.I. 9828577 - PART I.3/RESERVES,ADVANCES&SURPLUS

upfront fees received on interest/currency swaps likely were includible in income under s. 9 (so that no reserve under s. 20(1)(m) was available)...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 9 - Timing 49

22 July 1992, T.I. 921908 (May 1993 Access Letter, p. 189, ¶C9-262)

Up-front payments received by a marketer of timeshare units in order to provide "floating week leasing options" are amounts to which it is...

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13 May 1992 Internal T.I. 7-921151

Amounts received by gold producers under gold loans are not required to be included in income under s. 12(1)(a).

5 July 1990 TI AC59710

Where a promissory note is given in consideration for services, the acceptance of the note would be considered to be an amount received under s....

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Locations of other summaries Wordcount
Tax Topics - General Concepts - Payment & Receipt 75

11 April 1990 T.I. AC58705 File 5-8705

premiums received for the issue of bonds (presumably on income account) were to be included in income at the time of issue under s. 9 rather than...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 9 - Timing 124

IT-165R "Returnable Containers"

Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 10 - Subsection 10(1) 65

Articles

Larry F. Chapman, John M. Ulmer, "Canada", Tax Treatment of Hybrid Financial Instruments in Cross-Border Transactions, International Fiscal Association, Vol. LXXXVa, p. 207.

J. Frankovic, "The Taxation of 'Unearned Income'", Tax Topics, No. 1406, February 18, 1999.

Paragraph 12(1)(b) - Amounts receivable

Cases

Canada v. Huang and Danczkay Ltd., 2000 DTC 6549, docket A-500-98, 2002 FCA 226

The taxpayer, which was a real estate developer, agreed with each of three partnerships to construct and complete a MURB project and provide...

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La Capitale, Compagnie D'assurance Générale v. The Queen, 95 DTC 5587 (FCTD)

The taxpayer issued insurance policies on an annual basis to its individual customers, and gave them the option of paying their annual premium...

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The Queen v. Johnson & Johnson Inc., 94 DTC 6125, [1994] 1 CTC 244 (FCA)

Before going on to find that a federal sales tax refund did not represent income in the taxation year in question on another basis, Hugessen J.A....

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 9 - Timing backdating of effective time of sales tax refund 153
Tax Topics - Statutory Interpretation - Certainty 94

Stevenson & Hunt Insurance Brokers Ltd. v. The Queen, 93 DTC 5125, [1993] 1 CTC 383 (FCTD), briefly aff'd 98 DTC 6383 (FCA)

Contingent profit commissions, which an insurance broker was entitled to receive from insurance companies in respect of its 1983 fiscal year and...

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Maritime Telegraph and Telephone Co., Ltd. v. The Queen, 92 DTC 6191 (FCA)

The taxpayer was unsuccessful in arguing that the 1983 amendments to s. 12(1)(b) implied that amounts earned for the provision of services do not...

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West Kootenay Power and Light Co. Ltd. v. The Queen, 92 DTC 6023, [1992] 1 CTC 15 (FCA)

A hydro-electric utility included in its income for financial statement purposes an estimate of the value of electricity which have been consumed...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 9 - Accounting Principles 115
Tax Topics - Income Tax Act - Section 9 - Timing estimated amount was income 135

West Hill Redevelopment Co. Ltd. v. The Queen, 91 DTC 5430, [1991] 2 CTC 83 (FCTD)

A real estate developer which sold condominiums for consideration consisting in part of mortgages of the purchasers bearing interest at a...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 16 - Subsection 16(1) not applicable where mortgages receivable were all on income account 151
Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Inventory 44

West Kootenay Power and Light Co. Ltd. v. The Queen, 91 DTC 5214, [1991] 1 CTC 327 (FCTD), aff'd supra.

Before finding that an electric utility was not permitted to exclude from its income the value of electricity consumed by its customers for which...

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The Queen v. Imperial General Properties Ltd., 85 DTC 5045, [1985] 1 CTC 40 (FCA)

An agreement of purchase and sale of land provided for payment of $20,000 of the $844,250 purchase price on the execution of the agreement on...

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The Queen v. Timagami Financial Services Ltd., 82 DTC 6268, [1982] CTC 314 (FCA)

(Obiter) In s."12(1)(b), it was thought necessary, or at least desirable, to make it clear that the word 'receivable' was to include sums which...

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Wilchar Construction Ltd. v. The Queen, 81 DTC 5318, [1981] CTC 415 (FCA)

Although the Minister cannot require a construction company to include in its income the amount of holdbacks prescribed under the Mechanic's Lien...

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Minister of National Revenue v. Benaby Realties Limited, 67 DTC 5275, [1967] CTC 418, [1968] S.C.R. 12

In finding that the taxpayer realized income from land inventory in its 1955 taxation year (when an agreement was reached with the Crown fixing...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 9 - Timing profits recognized when ascertained 87

MNR v. Colford Contracting Co. Ltd., 60 DTC 1131, [1960] CTC 178 (Ex Ct), briefly aff'd 62 DTC 1338, [1962] CTC 546 (SCC)

Holdbacks on contracts for the installation of heating and plumbing systems became "receivable" when the architect's or engineer's certificates...

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Words and Phrases
receivable
Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 9 - Timing 25

Wilson and Wilson Ltd. v. MNR, 60 DTC 1018, [1960] CTC 1 (Ex Ct)

Cameron, J. held that the full amounts covered by interim progress certificates of the supervising engineer became "receivable" for the purposes...

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Words and Phrases
receivable

MNR v. Burns, 58 DTC 1028, [1958] CTC 51 (Ex Ct), briefly aff'd 59 DTC 1328 (SCC)

The taxpayer, when it sold cottages it had constructed, usually accepted second mortgages from the purchasers which it would subsequently sell at...

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See Also

Lockwood Financial Ltd. v. The Queen, 2020 TCC 128

The taxpayer (Lockwood), which was in the business of brokering the financing of junior resource corporations and other reporting issuers, helped...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 54 - Adjusted Cost Base value of shares included in fee income established their ACB 133

Supreme Steel Ltd. v. The Queen, 96 DTC 1430, [1996] 3 CTC 2152 (TCC)

Progress billings which the taxpayer rendered in its current taxation year for its work as a subcontractor were includable in its income in that...

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Outboard Marine Corp. of Canada Ltd. v. MNR, 90 DTC 1350, [1990] 1 CTC 2444 (TCC)

Duty drawbacks in respect of goods exported by the taxpayer from Canada which it had not yet applied for by the end of the taxation years in...

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Laurentide Rendering Inc. v. The Queen, 88 DTC 6331, [1988] 2 CTC 200 (FCA)

The Minister of Public Works expropriated the taxpayer's property in 1969, but an agreement fixing the expropriation compensation was not...

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Burrard Yarrows Corp. v. The Queen, 86 DTC 6459, [1986] 2 CTC 313 (FCTD), aff'd sub nomine Versatile Pacific Shipyards Inc. v. The Queen, 88 DTC 6352 (FCA)

The taxpayer, which was a corporation engaged in the construction of ships, agreed that title to all materials and finished parts would vest in...

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Administrative Policy

20 March 2013 Internal T.I. 2012-0463181I7 F - Revenu des entrepreneurs

CRA stated:

[C]onstruction and installation of communication and electricity structures are not covered by the completion method since they are...

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23 March 2011 Internal T.I. 2010-0389081I7 F - Disposition of a resource property

The Vendor sold a percentage interest in mineral claims for consideration including deferred cash payments to be paid over a four-year period. ...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 66.2 - Subsection 66.2(5) - cumulative Canadian development expense - Element F proceeds from mineral claims sale included undiscounted deferred cash proceeds, but might exclude share consideration until issued; purchaser’s CEE obligation excluded 390
Tax Topics - Income Tax Act - Section 54 - Proceeds of Disposition - Paragraph (a) proceeds included full (undiscounted) deferred cash proceeds, but might exclude share consideration (with volatile market price) until issued 175
Tax Topics - Income Tax Act - Section 12 - Subsection 12(1) - Paragraph 12(1)(g) deferred share consideration potentially not recognized until issuance 103

25 August 1994 External T.I. 9413085 - RECOGNITION OF INCOME FROM SERVICES

Before stating that the taxpayer was only required to recognize income from the performance of services when it was possible to render the account...

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1994 A.P.F.F. Round Table, Q. 25

"If a conditional sale of property to a client is not included in computing income under s. 9(1), s. 12(1)(b) could be invoked on the basis that...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 9 - Timing 16

20 August 1992 Internal T.I. 5-921716

Where there is a construction contract, its terms will establish when the contractor would have a legal right to receive amounts under the...

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22 August 1991 T.I. (Tax Window, No. 8, p. 11, ¶1407)

A fee payable to a committee for an incompetent is taxable in the hands of the committee as accrued even if a court has the discretion to make...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 54 - Adjusted Cost Base 34

21 August 1991 T.I. (Tax Window, No. 8, p. 21, ¶1402)

The 2% retroactive fee adjustment payable to Ontario doctors under OHIP should be included in their income on the date in May 1991 when the...

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24 May 1991 T.I. (Tax Window, No. 3, p. 19, ¶1235)

RC may require amounts receivable by a partnership under a prescribed revenue guarantee to be included in income before the payment date if there...

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IT-479R, "Transactions in Securities", para. 28-32

Where the writer of a put or call option treats gains or losses on income account, the premiums received will not be income until the option is...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 9 - Timing 65

IT-170R "Sale of Property - When Included in Income Computation"

5. The sale price of any property sold is brought into account for income tax purposes when the vendor has an absolute but not necessarily...

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Articles

Tetreault, "Canadian Tax Aspects of Asset Securitization", 1992 Conference Report, pp.23:21-23:25.

Paragraph 12(1)(c) - Interest

Commentary

General

S. 12(1)(c) provides that, subject to subsection 12 (3) (respecting accrual basis taxation for a corporation, partnership, units trust or...

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Cases

Newmont Canada Corporation v. Canada, 2012 DTC 5138 [at 7292], 2012 FCA 214

The taxpayer agreed to settle a loan owing to it of over $8 million plus accrued but unpaid interest through the payment to it by the debtor of $1...

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Locations of other summaries Wordcount
Tax Topics - General Concepts - Onus testimony sufficient to "demolish" assumptions 159
Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(b) - Capital Loss v. Loss loan made as investment in mining business 170
Tax Topics - Income Tax Act - Section 20 - Subsection 20(1) - Paragraph 20(1)(p) - Subparagraph 20(1)(p)(i) interest was bad as settlement proceeds not allocated to it 222

Bastien Estate v. Canada, 2011 DTC 5118 [at 6014], 2011 SCC 38, [2011] 2 S.C.R. 710

In the course of concurring reasons provided in finding that a interest income on a deposit with an on-reserve credit union represented property...

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Goulet v. The Queen, 2009 DTC 1875, 2009 TCC 127 (Informal Procedure), aff'd 2011 DTC 5138 [at 6120], 2011 FCA 164

In finding that the difference between the purchase price of notes and of commercial paper acquired by the taxpayer in the secondary market and...

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Alepin v. The Queen, 79 DTC 5259, [1979] CTC 360 (FCTD)

Notwithstanding the taxpayer's allegations to the contrary, there had never been an agreement (verbal or otherwise) between the taxpayer and a...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 16 - Subsection 16(1) payments applied first to interest 95

The Queen v. Elliott, 96 DTC 6189 (FCTD)

Twelve years after Ontario Hydro expropriated some farm lands of the taxpayer, it reached an agreement with the taxpayer to pay him $44,425 of...

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Munich Reinsurance Co. v. The Queen, 96 DTC 6185, [1996] 2 CTC 5 (FCTD)

Interest earned by the taxpayer (a German corporation carrying on a reinsurance business throughout the world, including through a branch in...

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Bellingham v. The Queen, 96 DTC 6075, [1996] 1 CTC 187 (FCA)

An award of "additional interest" received by taxpayer pursuant to s. 66(4) of the Expropriation Act (Alberta) (a provision which required the...

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Satinder v. The Queen, 95 DTC 5340 (FCA)

The difference between the $152,078 purchase price for a Government of Canada Treasury Bill, which the taxpayer acquired on May 2, 1989, and its...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 39 - Subsection 39(4) 64

The Queen v. Shaw, 93 DTC 5121, [1993] 1 CTC 221 (F.C.A.)

The farm lands of the taxpayer were expropriated pursuant to the Expropriation Act (Alberta) in 1977. Following the settlement in 1986 of an...

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Piché v. MNR, 93 DTC 5295 (FCA)

Interest owing to the taxpayer as a result of the acceptance by his co-shareholders of his offer to sell his shares in a corporation, was found to...

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Locations of other summaries Wordcount
Tax Topics - General Concepts - Payment & Receipt payment when cheque accepted as payment 87

Praxair Canada Inc. v. The Queen, 93 DTC 5100, [1993] 1 CTC 130 (FCTD)

As part of the restructuring of a company in financial difficulty, the taxpayer received Class C preference shares of the company having a par...

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Miller v. The Queen, 85 DTC 5354, [1985] 2 CTC 139 (FCTD)

Following binding arbitration, the appellant was awarded a salary increase retroactive to the beginning of the preceding year together with...

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Freeway Properties Inc. v The Queen, 85 DTC 5183, [1985] 1 CTC 222 (FCTD)

A mortgage with a term of July 1979 to December 31, 1984 provided that the present value of the interest which would have accrued over the balance...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 125 - Subsection 125(7) - Income of the Corporation for the Year From an Active Business interest on vendor-take-back mortgage was active 59

Salt v. The Queen, 84 DTC 6395, [1984] CTC 414 (FCTD)

An option agreement, in addition to granting the Grantee the option to acquire lands for a price of $240,000, provided that:

"[T]he Grantee agrees...

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The Queen v. Terra Mining & Exploration Ltd. (N.P.L.), 84 DTC 6185, [1984] CTC 176 (FCTD)

It was stated, obiter, that s."12(1)(c) require[s] accounting [for interest] in conformity with ordinary commercial practices and/or generally...

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Perini Estate v. The Queen, 82 DTC 6080, [1982] CTC 74 (FCA)

The deceased taxpayer sold a company in 1968 in consideration for an initial payment of $660,000 and three additional annual payments based on the...

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Locations of other summaries Wordcount
Tax Topics - General Concepts - Effective Date 186

The Queen v. Greenington Group Ltd., 79 DTC 5026, [1979] CTC 31 (FCTD)

The taxpayer made a second mortgage loan to a real esate developer ("Clearstream"). After Clearstream defaulted, the taxpayer arranged for an...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 9 - Capital Gain vs. Profit - Real Estate no profit-making intention at time of acquistion of property on debtor default 138

The Queen v. Quinn, 73 DTC 5215, [1973] CTC 258 (FCTD)

Under a contract with the Canadian Scholarship Trust Fund it was agreed that interest on funds deposited by the taxpayer would be transferred to...

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Hall v. MNR, 70 DTC 6333, [1970] CTC 510 (Ex Ct), briefly aff'd 71 DTC 5217 (SCC)

An individual taxpayer, who in two successive years clipped and sold overdue coupons in the amount of $10,000 on his Canada bonds to the trustee...

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Words and Phrases
in lieu of
Locations of other summaries Wordcount
Tax Topics - General Concepts - Payment & Receipt interest coupons required to be presented 79

Lloyd Estate v. MNR, 63 DTC 1349 (Ex Ct), briefly aff'd 65 DTC 5031 (SCC)

Before finding that bonuses or discounts received by the taxpayer (a dentist), on on a large portfolio of risky first mortgages acquired by him as...

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Huston v. MNR, 61 DTC 1233, [1961] CTC 414 (Ex.Ct.)

An award which the taxpayers received in 1958 from the War Claims Commissioner as compensation for the confiscation of their Czechoslovakian...

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McCullagh Estate v. MNR, 59 DTC 1159, [1959] CTC 308 (Ex Ct)

S.20 of the Succession Duty Act (Ontario) provided that where succession duty was paid before the due date, the Treasurer of Ontario was...

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See Also

Agence du revenu du Québec v. Bernardin, 2021 QCCA 625

An individual, by virtue of being part of a group of class action claimants, was awarded damages in 2004 of $1,200 for each of the eight winter...

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Words and Phrases
interest

Bernardin v. Agence du revenu du Québec, 2019 QCCQ 846, aff'd 2021 QCCA 625

The plaintiff was a member of a group of class action claimants who in 2004 received a judgement for $1,200 in damages for each of seven winter...

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News Australia Holdings Pty Ltd v Commissioner of Taxation, [2017] FCA 645

SRC was a wholly-owned subsidiary of an immediate subsidiary (News Limited) of the taxpayer. Income derived by SRC was attributed to the taxpayer....

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Pike v. Revenue and Customs Commissioners, [2014] BTC 33, [2014] EWCA Civ 824

The taxpayer subscribed for loan stock of a family company at a price equal to its principal amount. Although the loan stock did not bear any...

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Words and Phrases
interest

Pope & Ors v. R & C Commrs., [2012] UKUT 206 (Tax and Chancery Chamber)

The son of the taxpayers (Mr and Mrs Pope), who was the beneficiary of a life insurance policy which he had purchased on his own life, was...

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Holzhey v. The Queen, 2008 DTC 2607, 2007 TCC 247

The deemed disposition by the taxpayer, as a result of his ceasing to be a resident of Canada, of a loan made by him to a non-resident corporation...

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Words and Phrases
in lieu of

Mackinnon v. The Queen, 2008 DTC 2052, 2007 TCC 658

As a result of the payment of the proceeds of the RRSP of the deceased spouse of the son of the taxpayer to the spouse's estate rather than to the...

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Boersen v. The Queen, 2007 DTC 1696, 2007 TCC 671 (Informal Procedure)

An action by the taxpayer for a total of $68,000 in interest and principal owing to him under a loan to his uncle and a debtor company was settled...

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Montgomery v. The Queen, 2007 DTC 898, 2007 TCC 317 (Informal Procedure)

Pre-judgment interest (and some post-judgment interest) included in an award made to the taxpayer as a wages adjustment pursuant to the Canadian...

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Ahmad v. The Queen, 2002 DTC 2065 (TCC)

Prejudgment interest received by the taxpayer as part of a damages award for tortious interference by a third party with his employment contract...

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R.A. Hewitt & Sons Ltd. v. The Queen, 2000 DTC 2441 (TCC)

Interest on a loan made by the taxpayer to a foreign affiliate was includable in its income at the 5% interest rate provided in the loan agreement...

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General Motors Acceptance Corp. of Canada Ltd. v. The Queen, 2000 DTC 1844 (TCC)

The taxpayer purchased conditional sales contracts from Canadian General Motors franchise dealers and was reimbursed by General Motors of Canada...

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Fleishman v. R., 98 DTC 1836, [1998] 3 CTC 2096 (TCC)

Payments received by the taxpayer on a note owing by an arm's length debtor were found to be principal rather than interest on the basis of the...

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Locations of other summaries Wordcount
Tax Topics - General Concepts - Payment & Receipt creditor may apply payment as it determines if debtor does not 97

Donovan v. The Queen, 94 DTC 1143, [1994] 1 CTC 2394 (TCC), aff'd 96 DTC 6085 (FCA)

A corporation took title to a Florida residence for which the taxpayer had exclusive use. Although there were large interest-free loans owing by...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 15 - Subsection 15(1) Youngman did no consider the implications of barter exchange 109

Gestion Guy Ménard Inc. v. MNR, 93 DTC 1058, [1993] 2 CTC 2793 (TCC)

The taxpayer purchased significant quantities of treasury bills through its broker and sold them one day prior to maturity. In dismissing the...

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Schaffer v. Cattermole, [1980] T.R. 331, 53 TC 499 (CA)

The purchase price of a government bond reflected interest that had accrued up to the date of the purchase. Nonetheless, when interest was paid on...

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Davies v. Premier Investment Co. Ltd.; Hewetson v. Carlyle (1945), 27 TC 27 (KBD)

A company issued at par £500,000 in notes which did not bear interest and which were repayable in six years time together with a premium of 30%....

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Lomax v. Peter Dixon & Son Ltd. (1943), 25 TC 353 (CA)

The Finnish subsidiary of the taxpayer arranged to repay shareholder advances of £319,600 by issuing notes with a face amount of £340,000 and...

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CIR. v. Thomas Nelson & Sons, Ltd. (1938), 22 TC 176 (C.S. (1st Div'n))

The taxpayer lent money to its Indian subsidiary under an agreement which provided that interest was to be paid at 3% per annum (a "remarkably low...

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Paget v. CIR (1937), 21 TC 677 (CA)

The taxpayer held US-dollar denominated bonds of the Yugoslavian government which defaulted (although it offered alternative payment arrangements,...

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Wigmore v. Thomas Summerson and Sons Ltd. (1926), 9 TC 577 (Ch D)

The taxpayer, who had sold bonds with coupons attached but not yet due, had not received interest of money for purposes of Schedule D Case 111...

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Administrative Policy

10 May 2001 External T.I. 2001-0065705 F - DEDUCTION

CCRA indicated that a taxpayer who borrowed money at a higher rate of interest on the bond or preferred shares acquired therewith would be able to...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 20 - Subsection 20(1) - Paragraph 20(1)(c) - Subparagraph 20(1)(c)(i) interest deductible to the extent of preferred shares dividends received, but not deductible at all for bonds acquired at a negative spread 57

28 June 2017 External T.I. 2017-0705431E5 - funds held in settlement account

Settlement funds received by a law firm from the defendant in a class action suit are held in a settlement trust, to be applied solely for...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 149 - Subsection 149(1) - Paragraph 149(1)(w) court-supervised settlement fund for class action was not required by a law 186
Tax Topics - Income Tax Act - Section 150 - Subsection 150(1.1) - Paragraph 150(1.1)(b) - Subparagraph 150(1.1)(b)(i) class-action settlement fund was required to file T3 returns 188

22 January 2014 External T.I. 2014-0517121E5 - T5 Information Slip Reporting Requirements

A credit union pays a member an incentive for holding an account balance, calculated as a percentage of the balance held in the account on certain...

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6 September 2013 External T.I. 2013-0478241E5 - U.K. Individual Savings Account (ISA)

Although income earned in a UK Cash ISA is not subject to taxation in the U.K., under the Canadian Income Tax Act ("Act") Canadian residents ......

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5 October 2012 Roundtable, 2012-0453191C6 F - Investissements frauduleux

An article published in La Presse on the Earl Jones fraudulent scheme case indicated that CRA permitted the investors to file amended returns...

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16 February 2010 External T.I. 2009-0322751E5 F - Traitement fiscal des indemnités reçues

In finding that the damages awards in a class action suit, including prejudgment interest were received tax free, CRA referred to the surrogatum...

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12 May 2009 External T.I. 2008-0293561E5 - Income from Participating Loan

Respecting a loan made to an arm's length borrower where the terms of the loan include both a fixed rate of interest and a profit participation...

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28 September 2006 External T.I. 2006-0189101E5 - Interest Free Loan - Life Lease

A life lease (under which the tenant in a non-profit retirement housing complex makes an interest-free loan to the landlord to help fund...

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15 December 2006 External T.I. 2006-0182471E5 F - Intérêts " explicitement identifiés "

Regarding requested clarification of the position in Income Tax Technical News No. 30 that all pre-judgment interest, which is “explicitly...

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18 May 2006 Internal T.I. 2005-0162821I7 F - Imposition - article 1619 du Code civil

The Corporation commenced an action against the Insurer (which had refused to pay insurance proceeds on the death of the life of the Insured...

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Words and Phrases
interest

3 December 2004 External T.I. 2004-0089341E5 F - Intérêts et frais juridiques

The taxpayer brought an action to recover an amount believed to be payable to her pursuant to a codicil. A preliminary court order directed the...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(a) - Legal and other Professional Fees legal fees to recovery a legacy were non-deductible 102

30 September 2004 Internal T.I. 2004-0085051I7 F - Intérêts et indemnité additionnelle

A construction company sued a supplier for damages to its business suffered as a result of having been supplied the wrong product and was awarded...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 129 - Subsection 129(4) - Income or Loss interest on damages relating to lost business was active business income 268

13 August 2004 Internal T.I. 2004-0076861I7 F - Investissement à l'étranger

A resident individual (the taxpayer) lent a sum to a Barbados borrower pursuant to a debenture contract which provided that the return was payable...

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Words and Phrases
interest
Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 75 - Subsection 75(2) s. 75(2) would apply where loan proceeds would ultimately revert to the taxpayer 74
Tax Topics - Income Tax Act - 101-110 - Section 108 - Subsection 108(2) - Paragraph 108(2)(a) suspension of redemption right for more than one year would disqualify as s. 108(2)(a) trust 131

28 June 2004 Internal T.I. 2004-0073761I7 F - Dommages-intérêts-perte d'emploi

After the taxpayer was wrongfully dismissed, an arbitrator ordered that the taxpayer be reinstated and be paid his back pay. The corporate...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Retiring Allowance damages for failure to reinstate the taxpayer were a retiring allowance 89
Tax Topics - Income Tax Act - Section 56 - Subsection 56(1) - Paragraph 56(1)(l.1) reimbursement of legal costs incurred to recover damages for failure to reinstate were includible under s. 56(1)(l.1) 122
Tax Topics - Income Tax Act - Section 60 - Paragraph 60(o.1) deduction for legal fees incurred to recover damages that were retiring allowance 127

31 May 2004 External T.I. 2004-0074381E5 F - Créance: calcul des intérêts

Regarding interest-bearing bonds issued at a premium or discount, CRA stated:

[A] premium or discount on a bond does not constitute interest where...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 20 - Subsection 20(21) overview of s. 20(21) 129

IT-396R "Interest Income"

Locations of other summaries Wordcount
Tax Topics - General Concepts - Effective Date 81

27 November 2002 Internal T.I. 2002-0149207 F - INTERETS ET FRAIS LEGAUX

Prejudgment interest received by the taxpayers as part of an award of damages for defective work done on the homes they had purchased for personal...

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7 November 2001 External T.I. 2001-0092105 F - Traitement fiscal - dommages-intérêts

Two legatees of an estate were awarded damages and interest by the Quebec Superior Court for failure of the estate to pay them the legacies.

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22 June 2001 External T.I. 2001-0075275 F - Dommages-intérêts

The will of the deceased provided two legacies by particular title. After suing the estate, those legatees were awarded damages including...

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15 July 1998 External T.I. 9813585 - EMPLOYER WITHHOLDING OBL ON A RETIRING ALLOWANCE

Withholding was required on a retiring allowance which was considered to include punitive damages, severance pay and the payment of tuition,...

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13 May 1998 External T.I. 9727105 - PRE&POST-JUDGMENT INT ON WRONGFUL DISMISSAL

It is the position of RC that pre-judgment, or pre-settlement, interest received in respect of an award for damages for personal injury, death or...

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23 September 1996 Memorandum 962261 (C.T.O. "Partial Payment Rec'd for GIC & Accrued Interest")

"Unless there is any indication to the contrary, payments received in partial payment of debt (in this case, a GIC) should be applied first to...

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5 January 1996 CTF Roundtable Q. 31, 9523976 - GROSS-UP PAYMENTS

A gross-up on a debt obligation owing to a Canadian lender will be included in the Canadian lender's income under s. 9 or s. 12(1)(c) even "where...

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1996 Ruling 961994 (C.T.O. "Structured Settlements")

Favourable ruling where a personal injuries action by the taxpayer, the taxpayer's wife and their children is settled by the defendant agreeing to...

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IT129R Lawyers' trust accounts and disbursements (Archived)

Interest on Funds of Litigants

10. Where funds deposited with a lawyer by a litigant or litigants for safekeeping and investment, pending a court...

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22 August 1995 Internal T.I. 9505576 - PRE-DECISION INTEREST ON RETRO WCB AWARD

Given that a retroactive award for workers' compensation is very similar to an award of damages for personal injury or death, RC will treat the...

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1 May 1995 Internal T.I. 9510657 - DISCOUNTS ON BONDS

"A discount on a bond does not in general have the characteristics of interest where the effective rate of interest on the bond is similar to the...

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6 July 1994 Administrative Letter 9323826 F - Bonds Issued in Lieu of Interest

Bonds issued to a Canadian bank in settlement of arrears interest on a non-performing loan of a Brazilian debtor would not be considered to...

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Locations of other summaries Wordcount
Tax Topics - General Concepts - Payment & Receipt issuance of bonds re accrued interest did not constitute payment thereof 64

16 May 1994 T.I. 940456

A court-ordered payment by a corporation to its shareholder would be included in income under s. 12(1)(c) to the extent of pre-judgment interest...

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8 April 1993 Internal T.I. 9238487 F - Trust Money in Dispute

Where the litigants and the trustee of a litigation trust have not submitted waivers for each year, income earned by the trust on the trust funds...

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29 January 1993 T.I. 9200395 (Tax Window, No. 27, p. 1, ¶2360)

Where a casualty insurer acquires an annuity contract to fund a series of periodic payments to compensate an injured party for lost income and...

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22 January 1993 T.I. 9203635 (Tax Window, No. 27, p. 1, ¶2360)

A structured settlement agreement that provides for balloon payments which the injured person can elect in the future to take either as a lump sum...

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25 March 1992 T.I. (Tax Window, No. 18, p. 18, ¶1829)

Pre-judgment interest awarded or agreed upon in respect of employment income is included in income as interest. On the other hand, pre-judgment...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 5 - Subsection 5(1) 27

20 February 1992 T.I. 920074

RC was not prepared to extend its position in respect of pre-judgment or pre-settlement interest for personal injury or wrongful dismissal to...

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17 July 1991 T.I. (Tax Window, No. 6, p. 14, ¶1356)

A minimum return on capital paid to a partner may be considered interest income of the partner even though no deduction is available to the...

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11 May 1990 Memorandum (October 1990 Access Letter, ¶1494)

Interest received on GST rebates are taxable under s. 12(1)(c).

20 June 2023 STEP Roundtable Q. 16, 2023-0961321C6 - Damages in Respect of Personal Injury or Death

Regarding damages received on behalf of a child of parents killed in an accident, CRA indicated that where the amount received was not awarded as...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 81 - Subsection 81(1) - Paragraph 81(1)(g.1) a damages annuity to a child for financial loss from a parent’s death would not be exempted under ss. 81(1)(g.1) and (g.2) 199

88 C.R. - F.Q.24

Where a parent provides an interest-free loan to a child, and the child gives the parent a gift which compensates him for the lost interest...

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IT-365R2 "Damages, settlements, and similar receipts" 8 May 1987

Structured Settlement

5. A "structured settlement" is a means of paying or settling a claim for damages, usually against a casualty insurer, in...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 9 - Compensation Payments 325

86 C.R. - Q.69

A recapture of refund interest previously allowed may be netted against the original refund interest.

Articles

Marie-Eve Gosselin, Paul Lynch, "A Review of Interest Deductibility Since Ludco", 2015 CTF Annual Conference paper

CRA challenges to intercompany interest charges (p.7:18)

We have seen challenges [to the reasonableness of the interest rate] in related groups,...

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Lewis, "The Taxation of Structured Settlements", British Tax Review, 1994, No. 1, p. 19

A discussion of authorities supporting the position of Inland Revenue that the full amount of payments under a structured settlement are...

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Smith, "Corporate Restructuring Issues: Public Corporations", 1990 Corporate Management Tax Conference Report, pp. 6:4-6:6

Discussion of treatment of upward adjustments to the purchase price for shares to compensate the vendor for anticipated delays in the final...

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Ulmer, "Taxation of Interest Income", 1990 Conference Report, c. 8.