Must a corporation carrying on a personal services business (PSB) of selling property or negotiating contracts receive commissions from which the expenses under subparagraph 18(1)(p)(iii) will be deductible or can it deduct its expenses without receiving commissions?
After referencing the s. 8(1)(f) limitation, that the deduction thereunder cannot exceed the commissions or other similar amounts received by the employee in the year and that a corporation carrying on a PSB is subject to the same limitation, CRA stated:
In other words, if in the course of a taxation year a corporation carrying on a PSB did not receive any commission or other similar compensation in the course of carrying on its business of selling property or negotiating of contracts, it cannot deduct any amount spent by it that is related to the selling of property or the negotiation of contracts during that taxation year.
CRA went on to indicate that the range of potentially deductible expenses under s. 18(1)(p)(iii) was as discussed in relation to an employee in Guide T4044.