5 January 1996 CTF Roundtable Q. 31, 9523976 - GROSS-UP PAYMENTS -- summary under Paragraph 20(1)(c)

Where a gross-up on interest paid to a non-resident meets the legal definition of interest, it will be deductible by the taxpayer under s. 20(1)(c) assuming the other conditions of that paragraph are met. "Where the taxpayer is engaged in the business of lending money and the financing is on income account the gross-up will be deductible as an ordinary business expense under section 9 of the Act."