Words and Phrases - "principal"

a
86
b
44
c
76
d
50
e
38
f
31
g
18
h
14
i
73
j
2
k
2
l
32
m
56
n
25
o
38
p
80
q
3
r
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s
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t
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u
15
v
9
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y
2

S4-F2-C2 - Business Use of Home Expenses

Summary Under
Tax Topics - Income Tax Act - Section 18 - Subsection 18(12) - Paragraph 18(12)(a)

Meaning of principal place of business

2.11 ... The word principal is not defined in the Act but in this context is generally understood to refer to the individual’s chief or main place of business .

Example 1

Mr. A is a building contractor who uses a work space in his home to perform various administrative activities that are required in his business operations. These activities include receiving work orders, bookkeeping, ordering supplies and preparing payrolls. The remaining activities of the business, the performance of contracts, are carried out at various customer locations. The work space in Mr. A’s home therefore represents his main place of business. Mr. A’s children often use the work space in the evening to do their homework.

A work space need not be used exclusively for the business in order to meet the principal place of business requirement outlined in ¶2.4(a). This means that the room used by Mr. A in his home to perform the administrative functions of his business will be considered Mr. A’s principal place of business. ...

Qualifying work space: regular and continuous

2.13 A work space will be used exclusively to earn business income if it is a segregated area, such as a room or rooms, that is used in a business and for no other purpose.

2.14 The Act does not specify what is meant by the wording meeting clients, customers or patients, so the CRA looks to the ordinary or dictionary meaning of these words. The term meet is generally defined as to come face to face with or to come into the presence or company of (someone) by chance or arrangement. The term meeting is generally defined as an assembly or gathering of people by chance or arrangement. It is the CRA’s view that this traditional interpretation of the term meeting, being those held in person, applies for purposes of subsection 18(12).

2.15 Whether a work space is used to meet clients, customers or patients with sufficient regularity and frequency to meet the requirement in ¶2.4(b) depends on the nature of the business activity and the facts of each situation . However, a work space in respect of a business which normally requires infrequent meetings or frequent meetings at irregular intervals will not meet this requirement.

2.16 A work space in the home that is used by a doctor to meet one or two patients a week is an example of a work space that would not be considered to be used on a regular and continuous basis for meeting patients. On the other hand, a work space used to meet an average of 5 patients a day for 5 days each week would clearly be used for that purpose on a regular and continuous basis. ...

Words and Phrases
principal meeting