Produits pour toitures Fransyl Inc. v. Minister of National Revenue, 2006 FCA 112
Judge | Desjardins, Létourneau and Noël, JJ.A. |
Court | Federal Court of Appeal (Canada) |
Case Date | March 14, 2006 |
Jurisdiction | Canada (Federal) |
Citations | 2006 FCA 112;(2006), 354 N.R. 16 (FCA) |
Produits pour toitures Fransyl v. MNR (2006), 354 N.R. 16 (FCA)
MLB headnote and full text
[French language version follows English language version]
[La version française vient à la suite de la version anglaise]
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Temp. Cite: [2006] N.R. TBEd. MR.038
Les Produits pour toitures Fransyl Inc. (appelante) c. Sa Majesté la Reine (intimée)
(A-202-05; 2006 CAF 112; 2006 FCA 112)
Indexed As: Produits pour toitures Fransyl Inc. v. Minister of National Revenue
Federal Court of Appeal
Desjardins, Létourneau and Noël, JJ.A.
March 14, 2006.
Summary:
The Minister of National Revenue issued a reassessment disallowing in part a deduction of $1,865,726 for rent. The taxpayer appealed.
The Tax Court of Canada, in a decision reported [2005] D.T.C. 564, dismissed the appeal. The taxpayer appealed.
The Federal Court of Appeal dismissed the appeal.
Income Tax - Topic 1126.2
Income from a business or property - Deductions - General - Reasonableness of expense - The corporate taxpayer deducted $1,865,726 for rent payable to related corporations for 1995 - That amount was three times the rent deduction for 1994 and 1996 - That amount was also "significantly greater" than the fair rental value established by the expert evidence - The Tax Court of Canada affirmed a reassessment by the Minister of National Revenue which disallowed in part the 1995 deduction on the grounds that it did not meet the reasonableness requirements of s. 67 of the Income Tax Act - The Federal Court of Appeal upheld the decision.
Statutes Noticed:
Income Tax Act, R.S.C. 1985 (5th Supp.), c. 1, sect. 67 [para. 2].
Counsel:
Serge Fournier, for the appellant;
Anne Poirier, for the respondent.
Solicitors of Record:
BCF, LLP, Montreal, Quebec, for the appellant;
John H. Sims, Q.C., Deputy Attorney General of Canada, Montreal, Quebec, for the respondent.
This appeal was heard at Montreal, Quebec, on March 14, 2006, by Desjardins, Létourneau and Noël, JJ.A, of the Federal Court of Appeal.
The decision of the Court of Appeal was delivered from the Bench at Montreal, Quebec, on March 14, 2006, by Desjardins, J.A.
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Taxes? Reasonable?
...parties. For example, one Federal Court of Appeal decision (Les Produits pour Toitures Fransyl Inc. v. Her Majesty the Queen (HMQ), 2006 FCA 112, upheld a lower court conclusion "that no reasonable business person would have made these payments, which were almost three times the normal rent......
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Taxes? Reasonable?
...parties. For example, one Federal Court of Appeal decision (Les Produits pour Toitures Fransyl Inc. v. Her Majesty the Queen (HMQ), 2006 FCA 112, upheld a lower court conclusion "that no reasonable business person would have made these payments, which were almost three times the normal rent......