Marine pilots carry on their pilotage business through a partnership whose office is used only by administrative staff. The pilots receive their assignments by telephone at their homes, from where they carry out some of the preparatory work for the navigational activities, including preparing their passage plan, and updating of navigational notices, sounding reports and nautical charts, as well as the verification of tides and water levels.
Before finding that travel expenses incurred by them between their homes and the boarding station were likely non-deductible by virtue of s. 18(1)(h), CRA referred to the criteria in IT-514R, para. 2 as to what is a contractor's principal place of business, stated that “the jurisprudence defines a taxpayer's principal place of business as the place where secretarial activities are carried out, where financial statements and income tax returns are prepared, where communication with clients, suppliers, accountants, lawyers or government authorities takes place, and finally, where the company's mail is sent,” and then concluded:
[W]e cannot conclude that a pilot's home is the pilot’s principal place of business and, consequently, the expenses incurred by the pilot between the pilot’s home and the port of embarkation are personal expenses that are not deductible ... .