inventory

25 September 2007 Internal T.I. 2007-0226751I7 F - Gain en capital versus revenu d'entreprise -- summary under Paragraph 1102(1)(b)

The corporation’s regular activities involved the purchase of particular (redacted) types of equipment or vehicles that were damaged and/or out-of-use in order to restore them and rent them, following which, it would sell them at a gain over its cost. Some were sold without even having been rented previously. It also purchased items for parts only, which were disassembled so that the parts could be used in refurbishing the other items.

By services, 31 July, 2017

Ted Davy Finance Co. Ltd. v. MNR, 64 DTC 5124, [1964] CTC 194 (Ex Ct) -- summary under Inventory

Proceeds received by the taxpayer, which carried on the business of purchasing conditional sales contracts (mostly from a related used car dealer) and lending on the security of chattel mortgages, from the sale of its contracts and mortgages, were capital receipts. In finding that what was sold was not "inventory," Gibson J stated (at p. 5126) that the "definition of inventory...should not be given the broadest meaning that could be attached to it."

By services, 23 June, 2016

Kruger Incorporated v. Canada, 2016 FCA 186 -- summary under Inventory

The taxpayer ("Kruger") engaged in extensive trading of FX options, mostly writing European style puts and calls, although it also purchased FX options. Noël CJ found that Kruger was entitled to use mark-to-market accounting for tax purposes in recognizing a loss on its FX option position for its 1998 year.

23 September 2014 External T.I. 2013-0509021E5 F - Rajustement obligatoire -- summary under Paragraph 28(1)(c)

In the course of confirming its position in 9328315 F, CRA stated (TaxInterpretations translation):

[S]ows or boars which are still in inventory at the end of the fiscal period and which the producer purchased and paid for, could be property held in inventory even if they were not used in the production of piglets.

Likewise, pigs or piglets still in inventory at the end of the year that the producer purchased and paid for could be property held in inventory even if they were not used in the producer’s operation of raising animals.

By services, 28 November, 2015

Canadian Imperial Bank of Canada v. Canada, 2000 DTC 6207 (FCA) -- summary under Inventory

Before finding that gold and silver bullion of the taxpayer qualified as inventory, Sharlow J.A. indicated (at p. 6210):

"Property is 'described in a' taxpayer's inventory if it is inventory as a matter of fact and law. Inventory in its ordinary sense is simply stock in trade, or property held for sale in the ordinary course of a business."

inventory