Précis: The taxpayer and his brother both worked for a family company, Positano Paving. The company did snow clearance in the winter. The brothers shared the job of making “snow runs”, i.e., determining where within the “snowbelt” of Barry, Ontario customers required snow clearance. Snow runs were estimated to be between 90 and 100 kilometres. The brothers took snow runs on alternate days. The company paid them each an allowance of $9,100 as an estimate of the mileage they incurred during the winter season. The taxpayer did not report the amount thinking it was deductible in any event. CRA reassessed the taxpayer for 2012 and 2013 including the full amount in his income and not allowing any offsetting mileage expense. The taxpayer appealed to the Tax Court which dismissed his appeal. The Court held that his estimate of mileage expense was not a “reasonable vehicle allowance” and hence not deductible. There was no order as to costs since this was an informal procedure appeal.
Positano v. R. – TCC: Estimate of kilometers driven by an employee was not good enough to support a deduction for a reasonable vehicle allowanceREAD MORE »