A corporation owned a large area of vacant land in Canada (for instance, in an industrial park) and, as the corporation wished to locate in the park, it subdivided and sold portions of the vacant lot, which was its only activity. In finding that this would not constitute carrying on business for purposes of the definition of "qualified small business corporation share," CRA first quoted the statement in IT-459, para. 3 that:
Although an adventure or concern in the nature of trade is included in the definition of the term "business" in section 248, it does not necessarily mean that a taxpayer who is engaged in an adventure or concern in the nature of trade is "carrying on" a business or has "carried on" a business.
It then stated:
[A] corporation would not be carrying on a business where the purchase and sale of land are isolated or infrequent events, are not related to the other activities of a business carried on by the corporation, and where the activities are minimal or required solely to facilitate the sale. … If that were the case, the vacant land held by [the first] corporation would not be assets used principally in an active business carried on primarily in Canada by the corporation for the purposes of the definition … .