An employee received an $80,000 sales commission in 2008 but was required to repay the commission in 2009 consequent on the cancellation of the related sales contract. Should the employer issue an amended T4 for the 2008 year, or should the correction be made in the 2009 tax returns of the employer and employee? CRA responded:
[P]aragraph 8(1)(f) could allow the taxpayer to deduct the amount of commissions repaid in 2009 in computing the taxpayer's income for the 2009 taxation year from an office or employment as an amount spent in 2009 to earn that income, provided all the requirements of subparagraphs 8(1)(f)(i) to (iv) are satisfied.