26 October 1989 Income Tax Severed Letter AC58881 - Deductibility of Loan Interest

By services, 22 July, 2022
Official title
Deductibility of Loan Interest
Language
English
Document number
Citation name
AC58881
Severed letter type
Miscellaneous
d7 import status
Drupal 7 entity type
Node
Drupal 7 entity ID
656311
Extra import data
{
"field_external_guid": [],
"field_proprietary_citation": [],
"field_release_date_new": "1989-10-26 08:00:00",
"field_tags": []
}
Main text
C. Robb
         (613) 957-2744
         19(1)
         October 26, 1989
         19(1)
         We are writing in response to your letter of October 5,
         1989.
         In our view your request should be addressed to your
         local District Taxation Office.  However, we do offer
         the following comments.  As a matter of general
         principle interest on a loan is deductible if it has
         been incurred for the purpose of earning income from a
         business or property.  The decision in BRONFMAN 87 DTC 5059 (SCC) confirms our position that it is the direct
         use of the funds which is relevant to determining
         whether this test is met.
         We trust these comments will be of use to you.
         Yours truly,
         ILLEGIBLE SIGNATURE
         for Director
         Financial Industries Division
         Rulings Directorate