Section 3

Commentary

S. 3(a) requires the inclusion in income for purposes of the Act of income from sources inside and outside Canada "including, without restricting...

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Cases

Fiducie financière Satoma v. Canada, 2018 FCA 74

A tax plan turned upon a dividend that in fact was paid to a trust (Satoma Trust) being attributed under s. 75(2) to a corporation (“9134”)...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 245 - Subsection 245(1) - Tax Benefit tax benefit to trust from tax-free dividend even though not distributed to a beneficiary 277
Tax Topics - Income Tax Act - Section 245 - Subsection 245(4) using ss. 75(2) and 112(1) for tax-free dividends to trust thwarted s. 112(1) object to tax earnings when ultimately distributed 319
Tax Topics - Statutory Interpretation - Double Taxation (Presumption Against) inclusion of income in more than one taxpayer’s hands is contrary to s. 3 173
Tax Topics - Income Tax Act - Section 112 - Subsection 112(1) abusive to use s. 112(1) so as to avoid ultimate taxation of individuals 180
Tax Topics - Income Tax Act - Section 75 - Subsection 75(2) use of s. 75(2) to access s. 112(1) deduction for dividend in fact received by family trust, was abusive 286
Tax Topics - Income Tax Act - Section 82 - Subsection 82(2) s. 82(2) supports the primacy of s. 75(2) over the actual dividend recipient 60

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...

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R. v. Fogazzi, 92 DTC 6421, [1992] 2 CTC 321 (Ont. C.J. (G.D.)), rev'd 93 DTC 5183 (Ont. CA)

In finding that an amount misappropriated by the accused was not income under section 3, Sheppard J. stated (p. 6430):

"So not only must the word...

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The Queen v. McLaren, 90 DTC 6566, [1990] 2 CTC 429 (FCTD)

Before dealing specifically with the interpretation of s. 63(2), MacKay J. found (p. 6572) "that the word 'income', both in its ordinary usage and...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 63 - Subsection 63(2) "income" imports positive income 26
Tax Topics - Statutory Interpretation - Resolving Ambiguity 41

Laxton v. The Queen, 89 DTC 5327, [1989] 2 CTC 85 (FCA)

In a joint venture agreement it was agreed that an individual member of the joint venture ("Laxton") would be paid an annual management fee equal...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 96 real estate JV not a partnership 72

The Queen v. Cranswick, 82 DTC 6073, [1982] CTC 69 (FCA)

After a sale of the household appliance business of a Canadian corporation ("Westinghouse Canada") fell through due to failure to obtain approval...

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The Queen v. Atkins, 76 DTC 6258, [1976] CTC 497 (FCA)

Damages for wrongful dismissal were not income.

Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 5 - Subsection 5(1) damages for termination of employment contract were not received under the contract 56

Curran v. Minister of National Revenue, 59 DTC 1247, [1959] S.C.R. 850

The taxpayer, who was a highly-regarded senior geologist at Imperial Oil, received a lump sum from an indirect major shareholder of Home Oil upon...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 6 - Subsection 6(3) 59

See Also

Robinson v. The Queen, 2019 TCC 181 (Informal Procedure)

The taxpayer (with modest success) sought to follow a pattern of first investigating and developing opportunities and then dropping any resulting...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(b) - Capital Expenditure v. Expense - Start-Up and Close-Down Expenditures pre-incorporation expenses incurred in developing e.g., a patent portfolio for drop down to a corporation were capital expenditures 237

Smith v. The Queen, 2018 TCC 61 (Informal Procedure)

Graham J found that a status Indian, who earned exempt income from employment and non-exempt investment income, could only deduct a registered...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 147.2 - Subsection 147.2(4) RPP contribution deductible only from employment income rather than income generally 306
Tax Topics - Statutory Interpretation - Headings heading provided guidance on the overall framework 236

Henco Industries Limited v. The Queen, 2014 DTC 1161 [at 3528], 2014 TCC 192

A subdivision property of the taxpayer, a developer, was blockaded by Six Nations protesters. To diffuse the conflict, the Ontario government...

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Locations of other summaries Wordcount
Tax Topics - General Concepts - Evidence parol evidence rule not applying to surrounding evidence/press releases admitted 239
Tax Topics - General Concepts - Fair Market Value - Land deference to taxpayer's figure within appraiser's range of values 111
Tax Topics - Income Tax Act - Section 12 - Subsection 12(1) - Paragraph 12(1)(x) compensation received in course of business but not in course of earning income 192
Tax Topics - Income Tax Act - Section 14 - Subsection 14(5) - Cumulative Eligible Capital payment to withdraw from business was not an eligible capital amount 146
Tax Topics - Income Tax Act - Section 23 - Subsection 23(1) land ceased to be inventory through sterilization rather than business cessation 184
Tax Topics - Income Tax Act - Section 9 - Compensation Payments compensation payment for destroyed business was non-taxable 171

Malo v. The Queen, 2012 DTC 1214 [at 3588], 2012 TCC 75 (Informal Procedure)

The taxpayer bought a stake in his brother-in-law's tree farm, who was in financial trouble and had several judgments against him preventing him...

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Kelly v. The Queen, 2012 DTC 1109 [at 3055], 2012 TCC 66

Sheridan J. permitted the taxpayer's rental losses from the studio apartment she had purchased in a condominium near a ski resort. Her personal...

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Ruff v. The Queen, 2012 TCC 105

The taxpayer, a lawyer, was bilked of $400,000 by scam artists, posing as clients, who induced him to incur "processing " fees in connection with...

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Lyncorp International Ltd. v. The Queen, 2010 DTC 1351 [at 4335], 2010 TCC 532, aff'd 2012 DTC 5032 [at 6684], 2011 FCA 352

The taxpayer, owned and operated by Mr. Mullen, invested in shares and made non-interest bearing loans to a number of corporate ventures to which...

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Humphrey v. The Queen, 2006 DTC 2730, 2006 TCC 168 (Informal Procedure)

The taxpayer was assessed for amounts that she embezzled from her employer in 2000, declared bankruptcy because of this claim against her and,...

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Fortino v. The Queen, 97 DTC 55, [1997] 2 CTC 2184 (TCC), briefly aff'd on procedural grounds 2000 DTC 6060 (FCA)

Lump sums received by individual vendors of shares in consideration for their entering into non-competition agreements with the purchaser were...

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E. William Abrahamson v. Minister of National Revenue, 91 DTC 213, [1991] 1 CTC 2061 (TCC)

Rip TCJ. applied the principle in the Ansell Estate case (66 DTC 5508) that "when amounts are withdrawn from a trust they are capital except for...

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Bray v. Best, [1989] BTC 102, [1989] UKHL TC_61_705 (HL)

"It is a well established principle deriving from the nature of income tax as an annual tax, that a receipt or entitlement arising in a year of...

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The Queen v. Kuhl, 74 DTC 6024, [1973] CTC 846 (FCTD)

The source of services fees received by two brothers from a company that was controlled by them and engaged in the farming business was farming....

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Dorfman v. M.N.R., 72 DTC 6231 (FCTD)

Collier J. indicated (at p. 6134) that the words "source of income" in s. 13(1) of the pre-1972 Act (now s. 31(1)) "were used in the sense of a...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 31 - Subsection 31(1) 85

Administrative Policy

31 August 2020 Internal T.I. 2020-0851811I7 - US Economic Impact Payment

A permanent resident of Canada receives payments under the U.S. Economic Income Payment Program (US EIP) pursuant to the CARES Act, being a...

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4 October 2019 External T.I. 2019-0825431E5 - Tenant relocation assistance

The City’s approval of a rezoning application (involving demolition or renovation of various rental units) required the developer to make a...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 56 - Subsection 56(1) - Paragraph 56(1)(u) non-means-tested compensation received by residential tenants from a developer to compensate them for their dislocation costs was non-taxable 110

19 March 2019 External T.I. 2018-0748731E5 - Taxation of Settlement Amounts

The Labour Board issued an order determining that the Employer had committed an unfair labour practice and ordered the Employer to pay a lump-sum...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 6 - Subsection 6(1) - Paragraph 6(1)(a) award received by unionized employees based on an unfair labour practice of their employer was not referable to lost remuneration 80

29 July 2015 External T.I. 2015-0575631E5 - social assistance

A social assistance organization may purchase items such as cookware, cutlery, furniture and food cards to assist its clients, and may also assist...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 56 - Subsection 56(1) - Paragraph 56(1)(u) potential exclusion of payments in kind 290
Tax Topics - Income Tax Regulations - Regulation 233 - Subsection 233(2) potential exclusion of payments in kind 259

18 February 2013 Internal T.I. 2013-0477821I7 F - Montants forfaitaires - XXXXXXXXXX

In discussing the treatment of lump sums paid to federal employees following a finding by the Human Rights Tribunal that a discriminatory practice...

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S2-F1-C2 - Retiring Allowances

Harrassment or defamation damages

2.17 General damages relating to personal injuries sustained before or after a loss of employment, may be viewed...

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28 November 2014 Internal T.I. 2014-0531221I7 F - Montants forfaitaires accordés aux témoins

A lump sum paid to a witness by the Sureté du Québec (Quebec police) was potentially income to him. CRA stated (TaxInterpretations...

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2 October 2014 External T.I. 2013-0491411E5 F - Allocation pour une automobile

What is the tax treatment of amounts paid to taxpayers for using their cars in providing lifts for the organization? CRA stated...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 6 - Subsection 6(1) - Paragraph 6(1)(b) compensation for providing car rides not received in course of employment 140

2013 Ruling 2012-0464921R3 - Payment in lieu of continued PHSP coverage

Former employees of Canco or of its subsidiaries are creditors of Canco, following Canco going into CCAA proceedings, by virtue of having been...

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27 January 2012 External T.I. 2011-0421551E5 F - Pompiers volontaires

Before addressing the volunteer firefighter tax credit, CRA addressed whether amounts received by a part-time firefighter with modest remuneration...

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Words and Phrases
volunteer
Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 118.06 - Subsection 118.06(1) “volunteer” firefighters are not true volunteers 195

18 October 2011 External T.I. 2011-0394041E5 F - Fiducie personnelle- revenu brut

S. 110.6(1.3)(b)(i)(A) referenced a basis for a property being considered to be being used in the course of carrying on a farming business in...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Gross Revenue gross revenue from farming business did not include capital gains 107

12 April 2010 Internal T.I. 2009-0342871I7 F - Subvention aux naissances multiples

Respecting the multiple birth subsidy paid by the Ministère de la Santé et des Services sociaux to the mother of triplets, quadruplets, etc.,...

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12 April 2010 External T.I. 2009-0327161E5 F - Revenu de location

Regarding whether a taxpayer who rented her co-ownership interest in a house to her stepfather and mother, CRA stated:

Guide T4036, Rental Income...

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Locations of other summaries Wordcount
Tax Topics - General Concepts - Ownership CRA can be bound by a counter letter rather than the apparent contract 233

IT-232R3 "Losses - Their Deductibility in the Loss Year or in Other Years"

Losses, to the extent they do not reduce income to nil, must be used in the loss year or forfeited.

24 June 1992 External T.I. 5-920948

"For the purpose of paragraph 3(a) a flow-through share is a source of property income. However, when the share is held in conjunction with the...

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91 C.R. - Q.44

Strike pay is non-taxable even if the member performs picketing duties as a requirement of membership in the union.

2 October 1991 T.I. (Tax Window, No. 10, p. 20, ¶1493)

Union members who recieve a portion of the strike fund when they lose their jobs as the result of automation or a plant closure will not be...

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20 April 1990 T.I. (September 1990 Access Letter, ¶1404)

A flow-through share is a source of income for purposes of s. 3(a) and, accordingly, the deductions of CEE under s. 66.1(3) and CDE under s....

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20 April 1990 TI 5-9269

A taxpayer (which is not a principal business corporation) may deduct CEE or CDE without restriction to its income so as to create a non-capital...

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1989 Canadian Petroleum Taxes Society Roundtable, Q. 4

Where CEE is renounced under a flow-through share structure (either directly or where CEE renounced to a limited partnership is allocated to its...

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89 CPTJ - Q4

Where a JEC renounces CEE to its parent corporation, which is not a principal business corporation and has no resource property or resource...

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ATR-40 (18 March 1991) "Structured Settlements"

Description of the non-taxable receipt of periodic payments for damages in a personal injury case.

IT-334R2 "Miscellaneous Receipts"

"In order for any activity or pursuit to be regarded as a source of income, there must be a reasonable expectation of profit."

Forms

Articles

Joel A. Nitikman, "Reasonable Expectation of Profit - Where Are We Now?", Business Vehicle, Vol IV, No. 3, 1998, p. 204.

Paragraph 3(a)

Cases

Canada v. Fries, 90 DTC 6662, [1990] 2 S.C.R. 1322, [1990] 2 CTC 439

Amounts received by an employee of the Saskatchewan Liquor Board from the Saskatchewan Government Employees' Union (the "SGEU") in consideration...

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Locations of other summaries Wordcount
Tax Topics - Statutory Interpretation - Resolving Ambiguity doubt went to the taxpayer 38

Administrative Policy

2021 Ruling 2021-0894621R3 F - Paiement à un membre qui quitte

Members of a religious order that is a registered charity (the “Community”) have taken vows of perpetual poverty and turn over all their...

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31 August 2020 Internal T.I. 2020-0851071I7 - Hong Kong Cash Payout Scheme

As an economic response to months’ long protests and COVID-19, the Hong Kong government announced that the Hong Kong Cash Payout Scheme would...

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11 March 2009 External T.I. 2009-0306601E5 F - Remboursement de cotisations syndicales

CRA applied Fries in indicating that amounts received from a union that are not a reimbursement of union dues (and, thus, not taxable under s....

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 6 - Subsection 6(1) - Paragraph 6(1)(j) amounts received from a union that are not a reimbursement of union dues generally are exempt 142

21 August 2008 External T.I. 2008-0286051E5 F - Revenu de location

Two arm's length taxpayers - Ms. X and Ms. Y - are co-owners of a duplex, the lower premises of which are leased to a business. Ms. Y, who lives...

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9 May 2008 External T.I. 2008-0271781E5 F - Dédommagement pour perte de revenu de pension

Lump sum payments made by the Quebec government to members of two plans that had deficits were not be taxable given that the amounts were not...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Superannuation or Pension Benefit lump sums paid by Quebec government to members of deficit plans were not taxable 62

27 March 2007 External T.I. 2007-0226801E5 F - Orphelin(e)s de Duplessis

Regarding $15,000 each paid to “Duplessis Orphans” (being inter alia orphans who had been designated by an institution as mentally retarded...

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27 February 2007 External T.I. 2006-0216481E5 F - Montant payable à des retraités (annul ass. malad)

The employer, which had been paying a portion of the premiums for a private health insurance program for its retirees, will be terminated for...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 6 - Subsection 6(3) compensation for termination of retirees’ benefit plan not includible under s. 6(3) 90

6 October 2006 Roundtable, 2006-0197161C6 F - Étendu de l'allégement - Bulletin IT-470R

Would the acquisition by a life insurance salesperson of a policy on the life of the salesperson’s spouse or children or parents (father and...

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11 July 2006 External T.I. 2006-0182451E5 F - Indemnité versée par un syndicat

In order to encourage members to participate in union activities on their day off, the union compensates them during their attendance at union...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 8 - Subsection 8(5) payments by union to members to attend union conventions on their days off reduce the union dues deduction 136

28 March 2006 Internal T.I. 2005-0109761I7 F - Commandite reçue par une athlète

A sponsorship received by a student who was incurring significant expenses in connection with training and competitions involving her amateur...

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1 April 2005 External T.I. 2004-0097171E5 F - Item gagné lors d'un tirage

Prior to the closure of a company division, the social club of that division decided to use up the funds in the club fund (to which the employer...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 6 - Subsection 6(1) - Paragraph 6(1)(a) prize won in raffle by employee was includible in employee’s income to the extent of the portion of its value that was funded by the employer rather than fellow employees 216

10 January 2005 External T.I. 2004-0095361E5 F - Dommages

Regarding the treatment of damages received pursuant to proceedings against a professional for negligence resulting in loss of a survivor's...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 56 - Subsection 56(1) - Paragraph 56(1)(a) - Subparagraph 56(1)(a)(i) damages for negligence resulting in not becoming entitled to QPP would not be income under s. 56(1)(a)(i) 220

5 October 2004 External T.I. 2004-0067741E5 F - Indemnités aux jurés

Daily allowance paid to jurors and witnesses were includible in income - but not reasonable allowances to cover expenses incurred by the juror...

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3 August 2004 Internal T.I. 2004-0077991I7 F - Allocations d'aide à domicile reçues de la SAAQ

In connection with finding, in light of Maurice, 2001 DTC 3710, that car insurance proceeds received by the taxpayer to compensate her for her...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 152 - Subsection 152(1) CRA applies changes to its position as a result of taxpayer-friendly judgments effective to post-judgment assessments 96

12 July 2004 Internal T.I. 2004-0077981I7 F - Dédommagement-Régime de pension

A lump sum that the Quebec Treasury Board recommended be paid to the taxpayer on the basis that the taxpayer may have been credited with only a...

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9 July 2004 External T.I. 2004-0079221E5 F - Indemnité pour mauvaise information

The administrator of a registered pension plan of which the taxpayer was member made a mistake in computing the annual benefit payable to the...

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10 June 2004 Internal T.I. 2004-0073781I7 F - Orphelins et orphelines de Duplessis - intérêts

The taxpayer received a lump sum under the National Reconciliation Program for Duplessis Orphans (the "Program") (which the Directorate indicated...

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25 February 2004 External T.I. 2003-0042461E5 F - Invalidité d'un actionnaire/admin./employé

A corporation, which is the policyholder and beneficiary of an insurance policy protecting it against the disability of its...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(a) - Income-Producing Purpose premiums paid by corporation on disability policy on its principal employee are non-deductible 112
Tax Topics - Income Tax Act - Section 6 - Subsection 6(1) - Paragraph 6(1)(a) taxable continued payment of salary-equivalent payments to disabled employee, but no taxable benefit from employer’s previous payment of premiums on funding disability policy 150

24 February 2004 External T.I. 2003-0049351E5 F - Dommages moraux

Regarding amounts received by a union member for mental suffering, loss of enjoyment of life and physical injury, CRA reiterated its position in...

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Business Source/Reasonable Expectation of Profit

Commentary

One of the sources of income enumerated in s. 3 is a business. Based on a dictum in the Moldowan case, many subsequent cases found that a taxpayer...

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Cases

Canada v. Paletta, 2022 FCA 86

In order that he could shelter most or all of his income for his 2000 to 2006 taxation years through a straddle program (with much of his 2007...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Business common law concept of business informs the s. 248(1) definition 161
Tax Topics - Income Tax Act - Section 163 - Subsection 163(2) informal consultations with tax lawyers without formal opinion did not avoid gross negligence penalties 301
Tax Topics - Income Tax Act - Section 152 - Subsection 152(4) - Paragraph 152(4)(a) - Subparagraph 152(4)(a)(i) applicability of gross negligence penalty necessarily precludes statute-barring 102

De Geest v. Canada, 2022 FCA 22

The taxpayer, who stated that he had formed the subjective activity to no longer carry on his work of installing windows and other construction...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 163 - Subsection 163(2) penalties where the taxpayer’s legal argument had “no merit” 270

Renaud v. Canada, 2019 CAF 154

The taxpayer (a member of the Quebec bar) who worked in a legal services department of Transport Canada as a full-time employee, also taught a law...

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Ludmer v. Attorney General of Canada, 2018 QCCS 3381, aff'd 2020 QCCA 697

Two of the taxpayers (“Ludmer” and Steinberg”) were invested along with family, friends and acquaintances (all resident in Canada) in a BVI...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 56 - Subsection 56(2) recurring fee reduction amounts received for no work were income and taxable under s. 56(2) when directed to controlled company 289
Tax Topics - Income Tax Act - Section 152 - Subsection 152(4) - Paragraph 152(4)(a) - Subparagraph 152(4)(a)(i) nature of the legal advice relied upon was unclear 417
Tax Topics - Income Tax Act - Section 152 - Subsection 152(1) improper advancing of “settlement” elements that were not sustainable 45
Tax Topics - Income Tax Act - Section 94.1 - Subsection 94.1(1) equity-linked notes held in BVI company were portfolio investments held with a tax avoidance purpose, but were not subject to 7000(2)(d) interest accrual 576
Tax Topics - Income Tax Regulations - Regulation 7000 - Subsection 7000(2) - Paragraph 7000(2)(d) mere possibility of locking in value accretion each year did not crystallize the maximum amount of interest respecting the year 484
Tax Topics - General Concepts - Negligence, Fiduciary Duty and Fault damages awarded against CRA for inter alia making unreasonable reassessments 260

Radonjic v. Canada Revenue Agency, 2013 DTC 5152 [at 6352], 2013 FC 916

Russel J found that the Minister's decision (in a s. 152(4.2) application) to treat the taxpayer's online poker winnings as income lacked...

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Canada v. Johnson, 2013 DTC 5004 [at 5515], 2012 FCA 253

The taxpayer realized gains of $1.3 million from periodically placing funds with a rogue ("Lech") who, it was later discovered, had not invested...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 152 - Subsection 152(4) - Paragraph 152(4)(a) - Subparagraph 152(4)(a)(i) failure to seek confirmatory independent advice 204
Tax Topics - Income Tax Act - Section 9 - Exempt Receipts/Business taxable gains from contract with Ponzi operator 263

Tarascio v. Canada, 2012 DTC 5046 [at 6785], 2012 FCA 30

The taxpayer's degree in mathematics and experience with various forms of gambling were not a sufficient basis to reverse the trial judge's...

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Vankerk v. Canada, 2006 FCA 96

The taxpayers claimed deductions relating to their investments in purported partnerships whose purported business would be the production of sound...

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Hammill v. Canada, 2005 DTC 5397, 2005 FCA 252

The taxpayer was a co-owner in a clothing manufacturing company. He acquired a gem inventory over several years. A business contact informed him...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Business fraudulent scheme foisted on taxpayer was not a business 63
Tax Topics - Income Tax Act - Section 67 s. 67 can be applied to eliminate rather than just limit a deduction 108

McClelland v. Canada, 2004 DTC 6019, 2003 FCA 483

The taxpayer was not entitled to deduct losses from an alleged business as an artist given the finding of the trial judge (supported by the...

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Nadoryk v. Canada, 2003 DTC 5744, 2003 FCA 458

The Tax Court had correctly found that the taxpayer, who worked as a full-time employee, was not using his residence in connection with an auto...

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Maysky v. Canada (Attorney General), 2003 DTC 5337, 2003 FCA 237

The fact that a rental property of the taxpayer had formerly been his home and that he used the property as collateral for a line of credit...

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Jarquio v. Canada, 2003 DTC 5164, 2003 FCA 80 (FCA)

The taxpayer, who derived personal benefits from the ownership of a two storey residence containing four bedrooms by having her family live on the...

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Titus v. Canada, 2003 DTC 5158, 2003 FCA 78 (FCA)

There was a personal element in the acquisition by the taxpayer of a cottage property close to that of his parents, and the Tax Court judge had...

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Morris v. Canada, 2003 DTC 5236, 2003 FCA 116 (FCA)

The manner in which a full-time employee of BC Rail conducted a fishing guide activity from which he reported revenues under 5% of expenses was...

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Partridge v. Canada, 2003 DTC 5175, 2003 FCA 91 (FCA)

The Tax Court Judge did not commit a reviewable error when he found that the taxpayer's activities lacked commercial flavour and that the taxpayer...

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Mendoza v. Canada, 2003 DTC 5071, 2003 FCA 17 (FCA)

The trial judge had not erred in finding that a property owned "under" a partnership of the taxpayers, which was rented at a significant loss to...

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Walls v. Canada, 2002 DTC 6960, 2002 SCC 47, [2002] 2 S.C.R. 684

A limited partnership that had purchased mini-warehouses was found to have a source of income for purposes of s. 9 of the Act with respect to the...

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Stewart v. Canada, 2002 DTC 6969, 2002 SCC 46, [2002] 2 S.C.R. 645

There was no evidence that the taxpayer had acquired condominium rental units for his personal benefit. Accordingly, his property rental activity...

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Carter v. The Queen, 2001 DTC 5560, 2001 FCA 275 (FCA)

In response to a submission of the taxpayer that he should be treated as an individual and that the involvement of his wife and company with...

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Keeping v. Canada, 2001 DTC 5358, 2001 FCA 182 (FCA)

In reversing a finding of the Tax Court Judge that a teacher was not entitled to deduct the losses of his Amway distributorship, Rothstein J.A....

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Devito v. Canada (Attorney General), 2001 DTC 5394, 2001 FCA 166 (FCA)

An operation of the taxpayer in renting or trying to rent out two units and a spare room in his Burlington home was not engaged in with a...

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King v. Canada, 2001 DTC 5116 (FCA)

The Court affirmed a finding of the Tax Court that partnerships in which the taxpayer invested did not have a reasonable expectation of profit in...

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Cardella c. Canada, 2001 DTC 5251, 2001 FCA 39

The realization of profit from its rental operation was found not to motivate the partners of a limited partnership in which the taxpayer was a...

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Locations of other summaries Wordcount
Tax Topics - General Concepts - Onus 99
Tax Topics - Income Tax Act - Section 9 - Capital Gain vs. Profit - Real Estate barrier to resale of rental properties 106

Kuhlmann v. Canada, 98 DTC 6652, [1999] 1 CTC 38 (FCA)

The Court reversed a finding of the trial judge that a husband and wife team of practising physicians were not engaged in operating an "English...

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Mohammad v. The Queen, 97 DTC 5503 (FCA)

The taxpayer had acquired a co-ownership interest in a residential property by assuming his share of a first mortgage and borrowing money for the...

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The Queen v. Donnelly, 97 DTC 5499, [1998] 1 CTC 23 (FCA)

Before going on to find that the deduction of farming losses by the taxpayer was restricted by s. 31(1) of the Act, Robertson J.A. stated (at p....

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Watt Estate v. The Queen, 97 DTC 5459 (FCA)

In finding that the taxpayer could not deduct the costs incurred by her in seeking to develop her daughter (who was in the taxation years in issue...

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Attorney General of Canada v. Mastri, 97 DTC 5420 (FCA)

The Court reversed a finding of the Tax Court judge that the taxpayers were entitled to deduct their net loss from a rental property...

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Hickman Motors Ltd. v. Canada, 97 DTC 5363, [1997] 2 S.C.R. 336, [1998] 1 CTC 213

Before finding that equipment that the taxpayer received on the winding-up of one subsidiary and held for five days before transferring it to...

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Schwartz v. Canada, 96 DTC 6103, [1996] 1 SCR 254

Major J. stated, in an obiter dictum (at p. 6120) that "in the long line decisions that distinguish a 'business' from a 'hobby', it has been...

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The Queen v. Gulf Canada Resources Ltd., 96 DTC 6065, [1996] 2 CTC 55 (FCA)

Pratte J.A. noted (at p. 6067) (and Linden J.A. concurred at p. 6069) that the reasonable expectation of profit doctrine had no application where...

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Tonn v. The Queen, 96 DTC 6001, [1996] 1 CTC 205, [1996] 1 CTC 339 (FCA)

In 1989 the taxpayer purchased a vacant residential property in Scarborough, containing two residential rental units, with the expectation that...

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Yaki v. The Queen, 94 DTC 6637, [1994] 2 CTC 361 (FCTD)

In finding that the taxpayer operated his farm in his 1986, 1987 and 1988 taxation years with a reasonable expectation of profit Jerome A.C.J....

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Landry v. The Queen, 94 DTC 6624 (FCA)

Before finding that the taxpayer - who returned to the practice of law in 1979 at the age of 71, organized his practice in a similar manner to...

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McGovern v. The Queen, 94 DTC 6527, [1994] 2 CTC 231 (FCTD)

A condominium rental unit located at Paul Lake, near Kamloops, was found to have been purchased in December of 1980 with a reasonable expectation...

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Engler v. The Queen, 94 DTC 6280, [1994] 2 CTC 64 (FCTD)

A venture of buying and selling various gift items, was marginally profitable while it was conducted by the taxpayer on a part-time basis or...

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Johnson v. The Queen, 93 DTC 5462 (FCTD)

An employee of M.L.W. Bombardier who only visited his farm once a week except on summer vacations, and whose farming operation suffered consistent...

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DesChênes v. The Queen, 93 DTC 5234, [1993] 2 CTC 107 (FCTD)

The taxpayers, who were full-time employees of the federal government, were found not to have engaged in the leasing of a yacht with a reasonable...

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Edwardes v. The Queen, 91 DTC 5635, [1991] 2 CTC 269 (FCTD)

A full-time teacher was prohibited from deducting losses incurred in automobile performance rallying in the absence of any record of achieving...

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Blake v. The Queen, 91 DTC 5574 (FCTD)

A teacher who earned approximately $1,000 per year in farm revenues in the taxation years in question was unsuccessful in deducting farm losses...

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Bigelow v. The Queen, 90 DTC 6262, [1990] 1 CTC 351 (FCTD)

The taxpayer, who in his 1978 and 1979 taxation years was a full-time employee in a potash mine, was found not to be carrying on a thoroughbred...

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The Queen v. Demers, 90 DTC 6216, [1990] 1 CTC 317 (FCTD)

A husband and wife, who were full-time employees, and who in 1981 purchased farmland which required considerable work before it would become...

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McNeill v. The Queen, 89 DTC 5516, [1989] 2 CTC 310 (FCTD)

The taxpayer was found to have held his condominium with a reasonable expectation of profit after the time that he abandoned his intention to hold...

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Posno v. The Queen, 89 DTC 5423, [1989] 2 CTC 234 (FCTD)

The taxpayer, who worked full time as a co-ordinator of special education but had a passion for flying, purchased a high performance aircraft and...

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Madronich v. The Queen, 89 DTC 5093, [1989] 1 CTC 247 (FCTD)

The taxpayer's tree farm was found to have a reasonable expectation of profit in light of the reforestation operation being undertaken in a...

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Coupland v. The Queen, 88 DTC 6251, [1988] 1 CTC 414, 88 DTC 6252 (FCTD)

A campground operation on land in the Calabogie area of Lanark which an Ottawa resident with a full-time job had originally purchased as a holiday...

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Chequer v. The Queen, 88 DTC 6169, [1988] 1 CTC 257 (FCTD)

Although the taxpayer purchased a 48-foot diesel cruiser with a sincere belief that he eventually would make a financial success of an operation...

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The Queen v. Gorjup, 87 DTC 5348, [1987] 2 CTC 129 (FCTD)

The taxpayer, who at all relevant times had a full-time job, purchased 1/2 of his father-in-law's run-down 200-acre farm in 1975 with the...

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London Life Insurance Co. v. The Queen, 87 DTC 5312, [1987] 2 CTC 90 (FCTD), aff'd 90 DTC 6001 (FCA)

London Life provided excess computer capacity to its subsidiary ("LDS") and charged LDS a fee that was calculated so as to avoid any profit or...

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Magee v. The Queen, 87 DTC 5282, [1987] 2 CTC 17 (FCTD)

Two spouses, who carried on a truck repair service and an accounting service for truckers, were held not to be carrying on a small operation of...

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Meech v. The Queen, 87 DTC 5251, [1987] 1 CTC 421 (FCTD)

The taxpayer failed to establish that he acquired two Florida condominium units with a reasonable expectation of profit. One unit showed losses...

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Firestone v. The Queen, 87 DTC 5237, [1987] 2 CTC 1 (FCA), rev'g 86 DTC 6405, [1986] 2 CTC 251 (FCTD)

A taxpayer's expenses may be deductible even if "there is neither immediate income nor an immediate source of income in his business." In the...

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Croutch v. The Queen, 86 DTC 6453, [1986] 2 CTC 246 (FCTD)

A part-time farmer who realized farming losses for his 1977-1980 taxation years which were approximately twice his revenues was prohibited from...

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Gillis v. The Queen, 78 DTC 6103, [1978] CTC 44 (FCTD)

A full-time professor at the University of Prince Edward Island who purchased an 117 acre farm 7 miles away in dilapidated condition, built his...

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Moldowan v. The Queen, 77 DTC 5213, [1977] CTC 310, [1978] 1 S.C.R. 480

Dickson, J. stated that "if the taxpayer in operating his farm is merely indulging in a hobby with no reasonable expectation of profit, he is...

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McLaws v. The Queen, 76 DTC 6005, [1976] CTC 15 (FCTD)

An operation of breeding and keeping horses for racing purposes was held to be carried on as a commercial venture and with a reasonable...

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See Also

Duhamel v. The Queen, 2022 CCI 66

In 2010, 2011 and 2012, the net winnings of the taxpayer from participating in in-person poker tournaments were $4.87 million, $0.38 million and...

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Fyfe v. The Queen, 2022 CCI 20 (Informal Procedure)

The taxpayer spent approximately six months per year doing work for one client (mostly construction and repair work), and the balance of the year...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 122.7 - Subsection 122.7(1) - Working Income - Paragraph (c) a taxpayer who regularly reported business income was carrying on a business 160

Paletta Estate v. The Queen, 2021 TCC 11, rev'd 2022 FCA 86

The taxpayer in Friedberg entered into spread positions in gold futures contracts, and in the same taxation year closed out the losing legs on his...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 9 - Timing straddle trade losses recognized consistently with Friedberg 337
Tax Topics - General Concepts - Sham FX straddles were not shams, and “window dressing” is not a standalone anti-avoidance doctrine 241
Tax Topics - Income Tax Act - Section 163 - Subsection 163(2) a reasonable person would have surfaced the omission of an $8M trading gain with an inquiry of his accountant 391

DiCaita v. The Queen, 2021 TCC 5 (Informal Procedure)

In rejecting the Crown’s submission that the repair expenditures were not deductible because the rental unit at issue was not rented out during...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(b) - Capital Expenditure v. Expense - Improvements v. Repairs or Running Expense reconditioning of rental unit allowed as deductible expense 242
Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(a) - Income-Producing Purpose expenses of flight, at the conclusion of Las Vegas vacation followed by attending at a rental property in Phoenix, from Phoenix back home were deductible 284
Tax Topics - Income Tax Act - Section 18 - Subsection 18(12) significant time must be spent in home office to justify significant deduction 166

Larkin v. The Queen, 2020 TCC 98 (Informal Procedure)

The taxpayer was a 76 year old geologist with decades of successful experience as a prospector, entrepreneur and inventor, with a B.Sc. degree in...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(a) a geologist with no current income could deduct various expenses documented only in spreadsheets 210
Tax Topics - General Concepts - Evidence spreadsheet was sufficient documentation of various claimed expenses 99

Agence du revenu du Québec v. Weaver, 2019 QCCA 1687

The taxpayer, a full-time engineer working for a multinational (but also a self-described “gentleman farmer”), maintained two horses which his...

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Savage v. The Queen, 2017 TCC 247 (Informal Procedure)

The taxpayers worked full time but stated that they were building up a dog kennel business, which they had started in 1999, in order to supplement...

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Abenaim v. The Queen, 2017 CCI 223

A senior employee who, in the somewhat distant past, had also been a shareholder, received damages following his termination, and pursuant to a...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Retiring Allowance amount received by a terminated employee (claiming oppression) exceeding 18 months’ salary was non-taxable 486

Mazo v. The Queen, 2016 TCC 232 (Informal Procedure)

Graham J found that whereas successful participation in a Ponzi scheme gives rise to property income, successful participation in a pyramid scheme...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Business pyramid scheme gives rise to business, not property, income 287
Tax Topics - Income Tax Act - Section 9 - Timing revenue earned when credited to taxpayer's account with promoter 218

Berger v. The Queen, 2015 TCC 153 (Informal Procedure)

In 2011, the taxpayer lost his job at a radio station as a sports broadcaster. He started blogging on the Maple Leafs with a view to generating...

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Hakki v. Secretary of State for Work and Pensions & Anor, [2014] BTC 22, [2014] EWCA Civ 530

The question of whether the appellant was obligated to pay child support maintenance out of his poker winnings turned on whether, under the Social...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 9 - Exempt Receipts/Business careful and successful poker playing was not a trade or business 132

Roszko v. The Queen, 2014 DTC 1083 [at 3099], 2014 TCC 59

The taxpayer innocently advanced $800,000 to a corporation ("TransCap") which was engaged in a Ponzi scheme. He received $408,000 in total, styled...

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Locations of other summaries Wordcount
Tax Topics - General Concepts - Evidence finding of fraud by securities commission is a legal conclusion, not a factual allegation 104

Garber v. The Queen, 2014 DTC 1045 [at 2812], 2014 TCC 1

Each appellant (along with 600 other taxpayers over several taxation years in the 1980's) bought units in a limited partnership. Each of the 36...

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Drouin v. The Queen, 2014 DTC 1016 [at 2564], 2013 TCC 139

A Barbados corporation ("PIN") allegedly developed marketing software. It did business mainly through franchise arrangements, under which it would...

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Locations of other summaries Wordcount
Tax Topics - General Concepts - Onus late disclosure of assumptions does not reverse onus 134

Bouchard v. The Queen, 2013 DTC 1203 [at 1083], 2013 TCC 247 (Informal Procedure)

When his daughter was nine years old, the taxpayer created the "Tennis Mania LP," which used the funds contributed by him to reimburse him for...

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Kuhlmann v. The Queen, 2011 DTC 1297 [at 1675], 2011 TCC 410 (Informal Procedure)

The taxpayer and his wife carried on a consulting business through a partnership. They taxpayer subsequently became employed by the partnership's...

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Hanna v. The Queen, 2011 DTC 1279 [at 1584], 2011 TCC 382 (Informal Procedure)

The taxpayers held a rental property, which they intended to use to assist refugees coming to Canada. Campbell J. found that their expenses in...

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Perreault v. The Queen, 2011 DTC 1256 [at 1469], 2011 TCC 270 (Informal Procedure)

V.A. Miller J. allowed the taxpayer to deduct 50% of approximately $24,000 of business losses incurred in connection with a pyramid sales...

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Cohen v. The Queen, 2011 DTC 1195 [at 1080], 2011 TCC 262

The taxpayer attempted to claim $121,991 in poker losses on the basis that his gambling was a commercial activity. Pizzitelli J. found that the...

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Dickson v. The Queen, 2011 DTC 1123 [at 681], 2011 TCC 153 (Informal Procedure)

The taxpayer did not have a reasonable expectation of profit in various business activities. She did not invest enough time in her flight...

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Daoust v. The Queen, 2010 DTC 1331 [at 4265], 2010 TCC 330 (Informal Procedure)

The taxpayer could not claim a loss on the cottage he rented out. He used the cottage personally, and his rental activities did not demonstrate a...

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Landriault v. The Queen, 2009 DTC 1334, 2009 DTC 1243, 2009 TCC 378 (Informal Procedure)

The taxpayers rented out the upper floor of a residential property to their disabled son at a minimal rent which helped to defray operating costs,...

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Saint-Laurent v. The Queen, 2008 DTC 3668 (TCC)

In investing in a partnership the taxpayer had no intention of deriving any profit whatsoever and his only motivation was to generate a tax refund...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 96 105

Caputo v. The Queen, 2008 DTC 3596, 2008 TCC 263

A tax shelter arrangement under which the taxpayer agreed to pay licence fees for the right to market customer loyalty cards in specified areas...

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Allard v. The Queen, 2007 DTC 1667, 2005 TCC 91 (Informal Procedure)

The taxpayer, who rented out a property to his parents at a modest monthly amount, without any rental increases from 1997 to 2002, so that it was...

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Coome v. The Queen, 2007 DTC 1522, 2007 TCC 493 (Informal Procedure)

A real estate agent who showed persistent losses and who in the taxation years in question earned minimal revenue from his activity was found not...

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Leblanc v. The Queen, 2007 DTC 307, 2006 TCC 680

The two taxpayers, who together won over $5.5 million during a four year period from playing sports lottery parlay games, were found to not be...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Business winnings on internet gaming were non-taxable 151
Tax Topics - Income Tax Act - Section 9 - Exempt Receipts/Business compulsive gamblers rather than professionals 151
Tax Topics - Income Tax Act - Section 9 - Expense Reimbursement 151

Partridge v. The Queen, 2004 TCC 471 (Informal Procedure)

The taxpayer's a farming loss of $26,142 was allowed given that the only reason for the disallowance of the loss given by the Minister was the...

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Shaughnessy v. The Queen, 2002 DTC 1272 (TCC)

After finding that the taxpayer had incurred deductible interest respecting an investment in a rental condominium in Whister, B.C. on the basis of...

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Rikley v. The Queen, 2001 DTC 756 (TCC)

Before finding that the taxpayer was entitled to deduct losses incurred by him in operating a yacht for charter in the Caribbean, Bowman A.C.J....

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Allen v. The Queen, 99 DTC 968 (TCC)

The Minister's position, as revealed in the examinations for discovery, was that the taxpayers, who invested in what quickly became a profitable...

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Witkin v. The Queen, 98 DTC 1933, [1998] 3 CTC 2869 (TCC)

The taxpayers and other Canadians purchased a 99% interest in a partnership ("CL 1") which, in turn, owned a 99% interest in a Texas general...

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Balanko v. MNR, 88 DTC 6228, [1988] 1 CTC 317 (FCTD)

The gains of an inveterate gambler were not taxable. A statement of Judge Bonner was adopted that "there is a total absence of any evidence here...

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Hawkes v. The Queen, 97 DTC 1258, [1998] 1 CTC 2333 (TCC)

Before finding that the taxpayers were able to deduct amounts paid by them to a third party to help fund legal expenses to be incurred by the...

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Heier v. The Queen, 97 DTC 739, [1997] 1 CTC 2471 (TCC)

The taxpayer was not entitled to deduct her losses from operating a bookstore and selling religious artifacts. Her initial purpose in starting the...

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Griffin v. The Queen, 96 DTC 1731 (TCC)

The taxpayer, who had a successful medical practice, was unable to deduct any of his losses incurred in respect of an import/export business given...

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Heenan v. The Queen, 96 DTC 1344 (TCC)

A partnership in which the taxpayer allegedly invested as a general partner was found not to have a reasonable expectation of profit and,...

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Roopchan v. The Queen, 96 DTC 1338, [1995] 2 CTC 2415 (TCC)

It was not appropriate for the Minister to aggregate the small operating profit realized by the taxpayer in renting out a basement apartment in...

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Mattison v. The Queen, 95 DTC 489 (TCC)

In finding that the Minister had been "premature" in disallowing initial losses sustained by the taxpayer in his operation of selling Amway...

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Administrative Policy

13 May 2004 External T.I. 2003-0051951E5 F - Course automobile amateur

Regarding whether an amateur car racer receiving between $5,000 and $10,000 annually in sponsorships and incurring expenses between $10,000 and...

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17 January 2020 External T.I. 2017-0685341E5 - Tax Comparison of the FIT & Net Metering Programs

Under the Net Metering Program administered by the Ontario Power Authority, a participant who generates electricity primarily for the...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 9 - Computation of Profit a credit generated by a business under the Ontario Net Metering Program is only income when applied, and is offset by a deduction for the electricity consumed 261
Tax Topics - Income Tax Regulations - Schedules - Schedule II - Class 43.1 general Class 43.1 or 43.2 treatment of specified energy property rules to equipment used in the Ontario Feed-in Tariff program 157
Tax Topics - Income Tax Regulations - Regulation 1100 - Subsection 1100(25) application of exception to the specified energy property rules to equipment used in the Ontario Feed-in Tariff program 364

S4-F11-C1 - Meaning of Farming and Farming Business

Business source: Whether farm activities are a business

1.20 In order to determine if a farming business exists, it is important to consider...

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Words and Phrases
business

26 March 2015 Internal T.I. 2013-0503031I7 F - Existence d’une source de revenu

Although an individual’s activity, which he engaged in in order to generate funds for recreational activities, hade a certain level of...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(a) - Income-Producing Purpose criteria for determining whether a home is a principal place of business 164

12 February 2015 External T.I. 2014-0550771E5 F - Allocation à des bénévoles - chantier particulier

A registered charity sends volunteers on missions to developing countries and pays them an allowance of $X per day based on the National Joint...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 118.1 - Subsection 118.1(1) - Total Charitable Gifts mission work volunteers foregoing allowances 123
Tax Topics - Income Tax Act - Section 5 - Subsection 5(1) quite unrepresentative remuneration: exempt 106
Tax Topics - Income Tax Act - Section 6 - Subsection 6(6) mission work under 2 years in LDCs 109

3 October 2014 Internal T.I. 2014-0532051I7 - Rent and Part XIII Tax

A non-resident individual not carrying on business in Canada leases a Canadian property to a related resident individual at less than fair market...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 212 - Subsection 212(1) - Paragraph 212(1)(d) non-commercial arrangement not subject to s. 247 but is subject to Part XIII/property taxes included in rent/no Part XII tax on imputed rent 247
Tax Topics - Income Tax Act - Section 247 - New - Subsection 247(2) non-commercial arrangement not subject to s. 247 99

2 July 2014 Ministerial Correspondence 2014-0537231M4 - Local Exchange Trading System

Respecting whether participation in a local bartering exchange network would give rise to income, CRA stated:

Paragraph 5 of IT-490 indicates that...

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25 April 2014 External T.I. 2013-0485421E5 - Payments to Spouse for Attendant Care

The common law spouse of Mr. X, who was incapable of taking care of himself and was moved into a care facility, received expense reimbursement...

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3 April 2014 External T.I. 2013-0512371E5 F - Qualification des montants gagnés au jeu de poker

In connection with concluding that a taxpayer, who began to devote a substantial portion of his time to online poker gambling, earned income from...

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28 March 2014 External T.I. 2014-0525191E5 - Virtual Currencies (Bitcoins)

After stating that "if it is clear that a personal endeavour or hobby is pursued in a sufficiently commercial and businesslike way, it can be...

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4 March 2014 External T.I. 2013-0491981E5 F - Soins à un conjoint inapte

What is the tax treatment of amounts received by an individual (who has been appointed as a mandatary by the Superior Court of Quebec) for the...

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6 July 2012 Internal T.I. 2012-0453461I7 F - rental losses Canada-France Treaty

Subject to the rental property restriction rule respecting CCA, a Canadian resident individual generally can deduct rental losses incurred in...

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Locations of other summaries Wordcount
Tax Topics - Treaties - Income Tax Conventions - Article 24 s. 126(1) FTC re French income tax on rental income 89

18 September 2012 External T.I. 2012-0442581E5 F - Fiducie au profit d'un athlète amateur

A world-class amateur athlete (the “Athlete”) deposits qualifying performance income (as defined in s. 143.1(1)) to an athlete trust (the...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 143.1 - Subsection 143.1(2) amounts distributed from athlete trust were business income 129
Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(a) - Income-Producing Purpose expenses of athlete with athlete trust 127

29 March 2012 Internal T.I. 2011-0430871I7 F - Participation à une étude de recherche clinique

Pharmaco, which is engaged in the development of pharmaceutical drugs, recruits volunteers to be tested in clinical trials and agrees to pay them...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 5 - Subsection 5(1) "volunteers" for drug clinical trials earned business rather than employment income 26

10 April 2012 Internal T.I. 2011-0430291I7 F - Montant d'aide versé par la SAAQ à un conjoint

Are amounts received from the Société de l 'assurance automobile du Québec ("SAAQ") by a taxpayer for personal home assistance services...

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3 March 2011 External T.I. 2010-0379181E5 F - Jeux de hasard sur Internet

Respecting winnings of an individual from daily internet poker gambling, CRA stated:

Generally such activities will not be a source of income.

Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Business on-line poker winnings would be non-taxable if absence of conduct of serious business person 143

3 February 2011 External T.I. 2010-0389601E5 F - Allocation de transport

Under an agreement with the School Board (which previously provided student free transportation), the parent was required to personally arrange...

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26 July 2010 External T.I. 2010-0364721E5 F - Revenus de bien et d'entreprise

In the course of discussing the deductibility of expenses incurred in a rental or bed and breakfast operation, CRA stated:

a taxpayer may deduct,...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 18 - Subsection 18(12) bed and breakfast operation was business rather than property source (and thus subject to s. 18(12) limitation) since more than normal essential services provided 166
Tax Topics - Income Tax Regulations - Regulation 1100 - Subsection 1100(14) rental property restriction rule applies to business properties as well/"principally" references over 50% of the time 127

28 September 2010 External T.I. 2010-0372461E5 F - Exploitation d'une entreprise à perte

An individual, a pharmacist, operates a pharmacy at a profit but also, as part of the same business, has a commercial department which sells other...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(b) - Capital Expenditure v. Expense - Goodwill, Trademarks and Customer Lists per Canada Starch, a payment made to preserve goodwill or a business is not a capital expenditure 157

3 June 2009 External T.I. 2009-0319551E5 F - Déductibilité des dépenses

Before indicating that there were insufficient details regarding a question on expense deductibility to give a specific response, CRA gave an...

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12 June 2009 Internal T.I. 2009-0324511I7 F - Déductibilité des primes payées

A self-employed financial products broker receives commissions for the sale of life insurance policies that he takes out for his own benefit (the...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(h) premiums paid by broker on policies on which the insureds were family members were non-deductible notwithstanding that the related commissions earned by him were taxable 115

9 November 2009 External T.I. 2009-0337281E5 F - Paris sportifs sur Internet

Regarding whether a taxpayer deriving income from placing sports bets had a source of income, CRA stated:

[A]n activity that does not have a...

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26 March 2008 External T.I. 2007-0224771E5 F - Sommes reçues en échange de références de clients

XYZco, which is in the residential construction business, makes a $500 referral payment to each former customer who provides the name of a...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Regulations - Regulation 200 - Subsection 200(1) one-off referral fees to clients, if non-taxable, do not require T4As 99

4 June 2007 Internal T.I. 2007-0229251I7 F - Montants reçus pour aide personnelle à domicile

The cognitively-impaired victim of an automobile accident received compensation from the Quebec Automobile Insurance Association, which he, in...

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10 January 2007 External T.I. 2006-0171132E5 F - Revenu locatif

The taxpayer and his wife purchased a bungalow for their daughter, who was a single parent with a low income, with her staying there and being...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 54 - Principal Residence - Paragraph (a) exemption potentially available re bungalow rented (but not as a source of income) to daughter 165

26 April 2005 External T.I. 2004-0107761E5 F - Aide à domicile/SAAQ

A taxpayer, injured in an automobile accident in 1994, received in 2004 a sum from the Quebec auto insurer (the “SAAQ”) to reimburse him for...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 9 - Timing amount not business income until the entitlement thereto was determined 108

14 April 2005 External T.I. 2004-0107991E5 F - Participation à des études cliniques

Individuals participating in clinical studies to test new drugs for pharmaceutical companies were required to include the amounts they received...

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7 November 2002 CTF Roundtable Q. 1, 2002-0144140 - CTF STEWART & WALLS

In response to various questions on the impact of Stewart and Walls including its impact on CCRA’s use of the reasonable expectation of profit...

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11 December 1998 Internal T.I. 9828647 - PARAGRAPH 18(1)(A)

Discussion on whether certain swap transactions were entered into for the purpose of producing income in a situation where the swap contracts were...

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28 May 1990 T.I. (October 1990 Access Letter, ¶1446)

Where as a result of a temporary move to another city, an employee rents out his house at a rent which is less than the expenses of maintaining...

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October 1989 Revenue Canada Round Table - Q. 2 (Jan. 90 Access Letter, ¶1075)

The test of reasonable expectation of profit is applied at the level of the partnership, not at that of the partners. Therefore, in the case of a...

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IT334R2 "Miscellaneous receipts" 1 January 1995

10. Profits derived from bookmaking or from the operation of any gambling establishment (carried on legally or otherwise) constitute income from...

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87 C.R. - Q.35

In determining whether an activity has a reasonable expectation of profit, discretionary deductions should be considered if they are relevant in...

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84 C.R. - Q.75

List of criteria that are applied in assessing whether an enterprise has a reasonable expectation of profit.

Articles

Benjamin Alarie, "The Taxation of Winnings from Poker and Other Gambling Activities in Canada", 2011 Canadian Tax Journal, Vol 59, p. 731, at p. 757

"Only when a taxpayer as established a clear and consistent record of accomplishment in poker will there be sufficient evidence to take the...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 9 - Exempt Receipts/Business 44

John Saunders, "The Empire Strikes Back - The Rebirth of the Reasonable Expectation of Profit Test", 2003 British Columbia Tax Conference Report.

Joel A. Nitikman, "Reasonable Expectation of Profit - Where Are We Now?", Canadian Current Tax, Vol 8, No. 8, May 1998, p. 81.

John R. Owen, "The Reasonable Expectation of Profit Test: Is There a Better Approach?", 1996 Canadian Tax Journal, Vol. 44, No. 4, p. 979. [cited in the Hickman Motors case, supra, at p. 5373].

Silver, "Great Expectations: Are They Reasonable?", 1995 Corporate Management Tax Conference Report, c. 6.

Paragraph 3(c)

Administrative Policy

11 August 2020 Internal T.I. 2018-0782181I7 - Successored CCEE and Non-Capital Losses

CRA indicated that even though taking deductions under s. 66.7(3) to (5) from successored resource pools against income from successored...

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Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 66.7 - Subsection 66.7(3) deductions of successored resource expenditures cannot generate a non-capital loss 322
Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(a) - Incurring of Expense successored resource expenses are not deductible under s. 9 165