Words and Phrases - "profits"
BBM Canada (formerly BBM Bureau of Measurement) v. The Queen, 2008 DTC 4129, 2008 TCC 341
A non-share federal corporation that undertook audience measurement activities for the benefit of its members (commercial TV and radio stations) qualified as a not-for-profit organization. Boyle J. stated (at paras. 49-50):
If its reserves are reasonable and it operates on a cost recovery basis, it would be hard to say an organization realizes significant profits.
BBM only sells its data to its members. It would be difficult to impute a profit purpose to an organization that only sells to members on a cost recovery basis.
He rejected a submission of the Crown (at para. 28) "that 'for any other purpose except profit' means unrelated to any commercial or business activity" and stated (at para. 54) that "a public benefit or purpose is not a pre-requisite to qualifying for the paragraph 149(1)(l) exemption".
Quemont Mining Corp. Ltd. v. MNR, 66 DTC 5376, [1966] CTC 570 (Ex. Ct.), aff'd 70 DTC 6046 (SCC)
Cattanach J. stated respecting the word "profits" in Regulation 1201:
"I can see no justifiable reason for construing the word 'profits' as used in the Regulation in any sense different from the meaning attributed by authorities to that same word as used in the Income Tax Act."
The authorities defined "profits" as "the difference between the receipts from a business for the year and the expenses laid out to earn those receipts."
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(a) - Income-Producing Purpose | Quebec mining taxes non-deductible | 60 |
| Tax Topics - Statutory Interpretation - Interpretation Act - Subsection 15(2) | 53 |