13 December 2006 External T.I. 2005-0156201E5 F - Records on Heat Sensitized Paper -- summary under Subsection 230(1)

A taxpayer receives receipts from suppliers on thermal paper, the information on which naturally disappears after a few months. CRA noted that it “has not established a specific position with regard to the retention of supporting documents on thermal paper,” that it “is CRA's practice to disallow expenses that are not supported by appropriate documentation, unless there is other satisfactory evidence to support the amount claimed” and that Keating (2001 DTC 3750) indicated “that non-compliance with subsection 230(1), in and of itself, is not sufficient to conclude that an expense was not made, and that in such a case, the taxpayer bears the burden of proving that the expense was incurred.”