Zielinski v. The Queen, 2014 DTC 1023 [at at 2635], 2013 TCC 384 (Informal Procedure) -- summary under Real Estate

By services, 28 November, 2015

The taxpayer spouses purchased two adjacent parcels of land in 1993. They had the parcels subdivided and sold most of the land at a profit by 2007. VA Miller J found that the gain was profit from an adventure in the nature of trade, as it was clear that the taxpayers intended from the outset to buy the land for resale at a profit - for example, the taxpayers actively campaigned to amend local bylaws to permit the subdivision, and the husband even got elected to the municipal council to bring these amendments into effect. Their appeal was dismissed, save for allowing the deduction of some expenses.

The purchase and sale of a nearby duplex was likewise an adventure in the nature of trade. The taxpayers were in the process of building their principal residence at the same time as they were improving the duplex to sell at a profit.

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intention to subdivide and sell at time of purchase
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