INCOME TAX |
Income Calculation |
Deductions |
Massé v. M.N.R.
A-649-00
2003 FCA 351, Noël J.A.
26/9/03
7 pp.
Judicial review of judgment delivered by Tax Court of Canada ([2002] 3 C.T.C. 431), dismissing applicant's appeal against assessments issued for 1994, 1995, 1996 and 1997 taxation years--Issue deduction of rental losses incurred by applicant in regard to condominium situated in Florida--Issue whether Supreme Court decision in Stewart v. Canada, [2002] 2 S.C.R. 645, can be of any assistance to applicant--In Stewart, Supreme Court held that reasonable expectation of profit test in judging existence of source of income applies only in certain circumstances--Henceforth, Court may consider factors enumerated in Moldowan v. The Queen, [1978] 1 S.C.R. 480, only to extent activity bears some personal element--In case at bar, Tax Court Judge concluded that applicant first and foremost sought advantage of owning condominium in Florida for his personal purposes--Evidence supported this conclusion--Trial Judge therefore had to apply tests set out in Moldowan judgment and consider whether applicant could be said to have reasonable expectation of profit--Negligible rental income, when considered in light of high cost of financing and absence of serious business plan, allowed Tax Court Judge to find applicant did not have reasonable expectation of profit--Tax Court Judge's analysis consistent with approach recommended in Stewart--Judicial review dismissed.