An individual (A) sold leased land in Quebec to a non-arm’s length corporation of which A was not a shareholder on that basis that A retained the right to all the rents. After finding that the rentals received by the corporation would probably not have the "quality of income” since their receipt was subject to the obligation to pay them over to A, CRA stated:
Similarly, the payment of the amount to A would not be an expense incurred to earn income.