Collectibles

The taxpayer (Mr. X) accumulated over 35 years a collection of objects from an era out of a passion for objects from that era. Over the years, he exchanged and sold certain objects with the aim of obtaining new items for his collection. He then made a decision to dispose of the items in his collection, and sold the items one by one to different buyers on an auction website. In indicating that the objects likely were capital property, CRA stated:

Mr. X did not seem to have, at the time of the acquisition of the elements of his collection, the intention to sell them but rather to keep them for his personal enjoyment. Furthermore, he acquired the items over a period of 35 years … . If Mr. X only made some occasional trades and sales that were for the purpose of acquiring new items and not for profit, it seems to us that Mr. X was not usually engaged in activities that could earn him a profit in connection with those items. (However … it would have to be clear that the trades and sales were casual and were made to acquire new items and not for profit). Furthermore … it does not appear that this would be an adventure or concern in the nature of trade … .

Furthermore, “the fact that the objects were offered for sale on an Internet auction site is not, in our view, sufficient in itself to conclude that there was a change of use.”