Cases
Bernick v. Canada, 2004 DTC 6409, 2004 FCA 191
A Bahamian partnership of which the taxpayer was a member purchased bonds at less than 10% of their maturity value, recorded the bonds in its...
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| Tax Topics - General Concepts - Evidence | foreign law presumed the same | 62 |
| Tax Topics - Income Tax Act - Section 54 - Adjusted Cost Base | cost of bonds equal to their FMV | 139 |
| Tax Topics - Income Tax Act - Section 9 - Computation of Profit | 179 |
Canderel Ltd. v. Canada, 98 DTC 6100, [1998] 1 S.C.R. 147, [1998] 2 C.T.C. 35
Before going on to find that the taxpayer was entitled to immediately expense for tax purposes the amount of tenant inducement payments that it...
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|---|---|---|
| Tax Topics - General Concepts - Onus | 105 | |
| Tax Topics - Income Tax Act - Section 18 - Subsection 18(9) | 57 | |
| Tax Topics - Income Tax Act - Section 9 - Timing | lease inducement payments currently deductible | 124 |
| Tax Topics - Statutory Interpretation - Expressio Unius est Exclusio Alterius | inference made from narrow scope of s. 18(9) | 34 |
| Tax Topics - Statutory Interpretation - Deference to Legislature | presumption against judicial legislation | 79 |
Gulf Canada Resources Ltd. v. The Queen, 95 DTC 5189, [1995] 1 CTC 334 (FCTD), partially rev'd 96 DTC 6065 (FCA).
McKeown J. found (at p. 5196) that the decision of the taxpayer to capitalize all expenses of its start-up operation net of revenues "gave a truer...
Symes v. Canada, 94 DTC 6001, [1993] 4 S.C.R. 695, [1994] 1 CTC 40
Iacobucci J. indicated (p. 6009) that in considering what types of expenses may be deducted under s. 9, it is more appropriate to refer to "well...
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| Tax Topics - Other Legislation/Constitution - Charter (Constitution Act, 1982) - Subsection 15(1) | 90 | |
| Tax Topics - General Concepts - Evidence | 80 | |
| Tax Topics - General Concepts - Stare Decisis | 69 | |
| Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(a) - Income-Producing Purpose | unnecessary to consider whether should be change to traditional position that child care expenses were non-deductible | 121 |
| Tax Topics - Income Tax Act - Section 63 - Subsection 63(1) | 45 | |
| Tax Topics - Statutory Interpretation - Specific v. General Provisions | deduction to extent limited by a specific provision could not be deducted under a general provision | 74 |
| Tax Topics - General Concepts - Purpose/Intention | purpose to be determined having regard to objective manifestations thereof | 132 |
West Kootenay Power and Light Co. Ltd. v. The Queen, 92 DTC 6023, [1992] 1 CTC 15 (FCA)
In finding that the trial judge had erred in finding for the Crown on the basis of a requirement for conformity between the taxpayer's financial...
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| Tax Topics - Income Tax Act - Section 12 - Subsection 12(1) - Paragraph 12(1)(b) | 194 | |
| Tax Topics - Income Tax Act - Section 9 - Timing | estimated amount was income | 135 |
Maritime Telegraph and Telephone Company v. Her Majesty The Queen, 91 DTC 5038, [1991] 1 CTC 28 (FCTD), aff'd 92 DTC 6191 (FCA)
"The accounting principle which requires consistency in reporting from year to year, to ensure that an accurate picture of the taxpayer's...
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| Tax Topics - Income Tax Act - Section 9 - Timing | services performed but not billed | 111 |
Her Majesty The Queen v. Nomad Sand and Gravel Limited, 91 DTC 5032, [1991] 1 CTC 60 (FCA)
Before finding that security deposits paid to the provincial government were not currently deductible, Urie J.A. stated (p. 5035):
"The proper...
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| Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(a) - Incurring of Expense | 107 |
The Queen v. Foothills Pipe Lines (Yukon) Ltd., 90 DTC 6607, [1990] 2 CTC 448 (FCA)
Before finding that an amount which was a liability for accounting purposes nonetheless was a revenue receipt for income tax purposes, Urie J.A....
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| Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(e) | 139 | |
| Tax Topics - Income Tax Act - Section 9 - Nature of Income | 181 |
The Queen v. Metropolitan Properties Co. Ltd., 85 DTC 5128, [1985] 1 CTC 169 (FCTD)
Walsh J. indicated (at p. 5137) that GAAP "should normally be applied for taxation purposes also, as representing a true picture of a...
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| Tax Topics - General Concepts - Estoppel | 51 | |
| Tax Topics - Income Tax Act - Section 10 - Subsection 10(1) | cost of municipal services included in accordance with GAAP in cost of residential home development inventory | 102 |
Neonex International Ltd. v. The Queen, 78 DTC 6339, [1978] CTC 485 (FCA)
The taxpayer, which was in the business of producing custom-made electrical signs, in its financial statements included costs of constructing...
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|---|---|---|
| Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(a) - Legal and other Professional Fees | 92 | |
| Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(a) - Timing | 75 | |
| Tax Topics - Income Tax Act - Section 20 - Subsection 20(1) - Paragraph 20(1)(e) | loan prepayment bonus | 111 |
| Tax Topics - Income Tax Act - Section 9 - Capital Gain vs. Profit - Foreign Exchange | borrowing to fund proposed acquisition (through Buyco) on capital account | 160 |
The Queen v. Marchand, 78 DTC 6507, [1978] CTC 763 (FCTD), aff'd [1979] CTC xvii (FCA)
Addy, J. stated "that a taxpayer can now deduct an amount from income only on two conditions: first, that it would be normal practice according to...
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| Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(b) - Capital Expenditure v. Expense - Financing Expenditures | share subscription fee paid on capital account | 143 |
Silverman v. MNR, 60 DTC 1212, [1960] CTC 262 (Ex Ct)
At 1214-1215:
"[S]ince what is declared to be the income from a business is the profit therefrom for the year, the method adopted must be one...
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| Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(b) - Capital Expenditure v. Expense - Financing Expenditures | bonus payable on temporary mortgage financing of inventory on income account | 226 |
| Tax Topics - Income Tax Act - Section 9 - Computation of Profit | 74 |
Wilson and Wilson Ltd. v. MNR, 60 DTC 1018, [1960] CTC 1 (Ex Ct)
The completed contract, which was followed for accounting purposes, was found to be unacceptable for purposes of computing a contractor's income...
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| Tax Topics - Income Tax Act - Section 12 - Subsection 12(1) - Paragraph 12(1)(b) | 138 | |
| Tax Topics - Income Tax Act - Section 248 - Subsection 248(1) - Inventory | 15 | |
| Tax Topics - Income Tax Act - Section 9 - Timing | 142 |
MNR v. Publishers Guild of Canada Ltd., 57 DTC 1017, [1957] CTC 1 (Ex Ct)
Before agreeing with the accounting experts that the taxpayer's instalment method of accounting for its sales of magazines was more appropriate...
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| Tax Topics - Income Tax Act - Section 9 - Timing | 161 |
MNR v. Anaconda American Brass Ltd., 55 DTC 1220, [1955] CTC 311 (PC)
Viscount Simonds found the F.I.F.O. method to be preferable for income tax purposes, because it corresponded more readily to the actual physical...
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| Tax Topics - Income Tax Act - Section 10 - Subsection 10(1) | 256 |
Dominion Taxicab Association v. Minister of National Revenue, 54 DTC 1020, [1954] CTC 34, [1954] S.C.R. 82
"The expression 'profit' is not defined in the Act. It has not a technical meaning and whether or not the sum in question constitutes profit must...
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| Tax Topics - General Concepts - Evidence | 51 | |
| Tax Topics - Income Tax Act - Section 9 - Capital Gain vs. Profit - Deposits | 73 | |
| Tax Topics - Income Tax Act - Section 9 - Nature of Income | 96 | |
| Tax Topics - Income Tax Act - Section 9 - Timing | deposit excluded | 78 |
See Also
Ford Credit Canada Limited v. The Queen, 2006 DTC 3424, 2006 TCC 441
Before going on to find that the taxpayer was specifically required by s. 181(3) to treat retractable preferred shares in its capital as debt,...
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| Tax Topics - General Concepts - Accounting Principles | 83 | |
| Tax Topics - Income Tax Act - Section 181 - Subsection 181(3) | 41 |
Consoltex Inc. v. The Queen, 96 DTC 1812, [1996] 1 CTC 2752 (TCC)
The taxpayer had valued its inventories of the lower of cost on market for financial statement and income tax purposes in its 1979 and prior...
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| Tax Topics - Income Tax Act - Section 10 - Subsection 10(1) | 100 |
Ikea Ltd. v. The Queen, 94 DTC 1112, [1994] 1 CTC 2140 (TCC), aff'd 96 DTC 6526 (FCA), aff'd 98 DTC 6092 (SCC)
In doubting the relevance of the treatment of a tenant inducement payment in the taxpayer's financial statements, Bowman J. stated (p. 1117):
"One...
Gallagher v. Jones, [1993] BTC 310 (CA)
In finding that two leasing companies were required to amortize large initial lease payments made by them over the terms of the leases in...
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| Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(a) - Timing | 153 |
Willingale v. International Commercial Bank Ltd. (1978), 52 TC 242 (HL)
In finding that discounts on bills should be taken into income on the disposition of the bills rather than on a straight-line basis, as was done...
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| Tax Topics - Income Tax Act - Section 9 - Timing | 164 | |
| Tax Topics - Statutory Interpretation - Resolving Ambiguity | 40 |
Administrative Policy
Income Tax Technical News, No. 41, 23 December 2009 Under "Definition of 'Tax Shelter' - Subsection 237.1(1)
7 June 1995 Internal T.I. 9506157 - ACCRUED VACATION PAY
Respecting a taxpayer who has deducted accrued vacation pay for income tax purposes but not for financial statement purposes, such a deduction...
28 February 1994 Institute of Chartered Accountants of Nova Scotia Roundtable Q. 23, 9401480 - TAXATION OF AMOUNTS RECEIVABLE
The decision in West Kootenay (92 DTC 6023) "confirms that income for tax purposes, must be computed in accordance with a method within GAAP that...
1994 APFF Round Table, Q. 40
"In some cases, a taxpayer may select from among a number of accounting methods, each one equally valid. The profit for tax purposes should be...
25 September 1992 T.I. (Tax Window, No. 23, p. 11, ΒΆ2171)
Changes in the shareholders of a corporation (including an acquisition of control) will not by themselves justify a change in the accounting...
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| Tax Topics - Income Tax Act - Section 9 - Computation of Profit | 47 |
IT-417R "Prepaid Expenses and Deferred Charges" under "Pre-Production or Start-Up Cost of a New Business"
It is an essential requirement of GAAP that the method of accounting be consistent from year to year, and this requirement is insisted upon for...
Articles
Mike Wilson, Fraser Gall, "No Impact on Tax - Wrong!", CA Magazine, November 2008, p. 42: Discussion of impact of IFRS standards.
David Nathanson, "Determining Business 'Profit' for Income Tax Purposes", Tax Litigation, Vol. X, No. 4, 2002, p. 646.
1995 British Tax Review
, No. 5, Special Issue - Accounting Standards and Taxable Profits, p. 433.
Commentary
Canadian judicial statements of the degree of persuasiveness or relevance of accounting principles or practices in the determination of income...