RICHARD T MCCULLOUGH vs. HIS MAJESTY THE KING

Docket: 2021-285(IT)I RICHARD T MCCULLOUGH vs. HIS MAJESTY THE KING September 14th, 2022 Mr. McCullough deducted employment expenses (motor vehicle, lodging and meals) for the 2017-2019 taxation years. The expenses related to travel expenses from the taxpayers regular place of employment to a sister company in the US for temporary arrangement. The minister of revenue subsequently reviewed the expenses and denied them on the basis that that taxpayer had two regular places of work. The case specifically hinged on the interpretation of section 8(1).h of the income tax act (Travel Expenses). The position of the taxpayer was that their duties were temporary, not on a full time in nature and his regular place of work was in Ontario. The Tax Court of Canada sided with the taxpayer on the basis that the taxpayer was required to perform his duties away from his regular place of employment working at the sister company (a separate legal entity). This case confirms eligible employment expenses and GST/HST incurred for work performed to a related company are most likely deductible personally despite a formal contact. No cost were awarded.

RAGAT VOHRA vs The King - Spousal Support

Docket: 2021-30(IT)I

The appellant, Mr. Vohra, claimed a $42,000 deduction for spousal support on his 2018 personal tax return. The Minister of National Revenue (CRA) subsequently performed a routine post-assessment review on the deduction and denied the claim because there was no written separation agreement. The separating parties prepared their own agreement, which contained many flaws. There was no indication that the "agreement" was approved by legal counsel. The Minister of Revenue held the position that a home-made separation agreement was not an actual agreement and would not suffice for tax purposes.

The appellant brought the matter before the Federal Court of Appeal and was successful in reinstating the deduction on his 2018 tax return. No costs were awarded to either party. Despite the fact appellant was successful, we don't recommend preparing your own legal document when a marriage breaks down but rather seeking the services of an experienced divorce lawyer.

Passenger Vehicle Expenses Limitations

Maximums Threshold as prescribed by the Canada Revenue Agency (2023):

Monthly Loan Interest: $300.00

Monthly Lease Cost: $950.00

(Increase from $900 from 2022)

Capital Cost Maximum: $36,000.00

(Increase from $34,000 from 2022)

Capital Cost Maximum For Zero Emissions Vehicles: $61,000.00

(Increase from $59,000 from 2022)