(q)-(vv)

CRA considered a plan that provides supplementary benefits to in individual pension plan to be a salary deferral arrangement rather than a retirement compensation arrangement if the benefits provided for are unreasonable – which CRA will consider to be the case unless the terms of the supplemental plan are substantially the same as those of the IPP and the supplementary benefits merely provide the employee with a supplement for the benefits that would be provided under the IPP but for the defined benefit limit.

Employer accidentally missed contributing, to a group RRSP or defined contribution pension plan, the Employer's portion on behalf of an employee for a time period, and will now make a restorative payment to the accounts of the employee under the Plans to compensate for the lost income from the missing contributions. Does a taxable benefit result? CRA responded:

Where a payment made by an employer into a registered plan of an annuitant is reasonable compensation for an employee's financial loss and the payment is the result of a wrongdoing or tort in the administration of the plan…the payment would not be viewed as employment income to the employee. …[N]either the employer nor the employee are considered to have made a contribution or paid a premium to the registered plan as a consequence of the payment of damages and therefore, there is no corresponding deduction available under paragraph 20(1)(q) or paragraph 60(i).

A Company determined that, rather than securing a non-registered supplemental employee retirement plan (“SERP”) for its senior employees using letters of credit, there would be lower fees to instead arrange for surety bonds to be delivered to the trustee for the security arrangements by insurance companies. In addition, “surety bonds will not reduce the Company’s borrowing capacity (in contrast to LOCs).”

This entails essentially following the same arrangements as where LCs are used. Every time a surety bond is required to be issued, renewed or replaced, the Company will be required to pay the surety fee to the trustee under a new trust, and the Company will make a corresponding payment to the Receiver General equal to the surety fee on account of the refundable tax payable under Part XI.3. The trustee will, in turn, pay the surety fee to the insurance company for such issuance, renewal or replacement of a surety bond.

CRA ruled that the amounts paid to the trustee by the Company and the amounts remitted to the Receiver General by the Company, will constitute contributions made to the retirement compensation arrangement, and will be deductible by the Company to the extent permitted by s. 20(1)(r) for the taxation year in which they are made.

A closely-held corporation that was dividending out all the profits of its business also established a purported retirement compensation arrangement (RCA) trust for two employees who, indirectly, were the corporation’s two shareholders, and made contributions to the trust that were funded by loans from the trust. In finding that the arrangement did not qualify as an RCA because the benefits were not reasonable, the Directorate noted that the two individuals rendered their services to the corporation on a part-time basis, the contributions were funded with the loans rather than out of earnings, and it was only recently that the corporation had started paying salaries to the individuals.

The Directorate went on to state:

Paragraphs 18(1)(o.2) and 20(1)(r) generally limit the deduction of contributions made in a year by a taxpayer under a retirement compensation arrangement to contributions that relate to services rendered by an employee or former employee of the taxpayer. While we are of the view that amounts paid to the trustee under the Arrangement are not amounts paid under a retirement compensation arrangement, we are of the view that those paragraphs would apply if it were determined that the Arrangement was a retirement compensation arrangement.

Are contributions by a corporation to an RCA deductible in computing its income where the contributions relate to services rendered by a shareholder-employee while self-employed and before the corporation’s incorporation? After paraphrasing the s. 20(1)(r) wording, CRA stated:

[F]or a corporation to deduct contributions in respect of a shareholder-employee, the contributions must relate to services rendered to that corporation as an employee.

After referring to the s. 67 limitation, it stated:

[T]he position set out in [1981 CTF Roundtable, Q.42], which applies to the reasonableness of bonuses paid to … shareholder-employees, also applies in determining the reasonableness of contributions, for the purposes of section 67, to an RCA for the benefit of a shareholder-manager.

CRA indicated that the deduction under s. 20(1)(r) could be limited by s. 67 and that there was nothing in s. 152(3.1) that would restrict its application to the s. 20(1)(r) deduction.

Mine tailings may be ore from a mineral resource such that income from processing tailings may qualify for the resource allowance.

A tenant had been annually renewing a lease of a condo since the time the condo was first leased in July 2013. The condo was sold in February 2019. The new owner, who wished to dwell in the premises, was not entitled to terminate the lease until effective July 2020. In consideration for the early termination of the lease, the new owner paid $15,000 to the tenant. S. 20(1)(z) provides for deductibility of the amount specified notwithstanding ss. 18(1)(a) and (h).

Is the $15,000 deductible in computing the new owner’s income under s. 20(1)(z) notwithstanding that the new owner wishes to inhabit the condo following the termination of the lease?

CRA stated:

Paragraph 20(1)(z) is applicable notwithstanding paragraphs 18(1)(a), 18(1)(b) and 18(1)(h). However, the amount to be deducted must be applicable wholly or in part to income from a business or property.

… In this case, the leasing activity does not appear to be free from personal aspects and it would be necessary to consider whether it is carried on in a sufficiently commercial manner so as to establish the existence of a source of income.

"In a situation where a lessee has constructed a building on land leased under a long-term lease and the lease provides that the building becomes part of the land, possession of which reverts to the lessor upon the termination of the lease, a payment made by the lessor to cancel the lease may appropriately be viewed as in part a payment to cancel the lease of the land (the property that is the subject of the lease) and in part a payment for early possession of the building. In our opinion, it would be appropriate to apportion the payment into its two components on the basis of the relative values of the land and the building. Accordingly, that portion which relates to the cancellation of the lease of the land would be deductible in accordance with the provisions set out in paragraph 20(1)(z) … ."

Where the taxpayer makes a lease cancellation payment to tenants in order to obtain vacant possession of a building which is to be demolished so that a new building can be erected on the site, 3/4 of the portion of the lease cancellation payment which relates to the building generally will be deductible by the taxpayer in the year the building is demolished, and the portion of the lease cancellation payment referrable to the underlying land will be deductible over the remaining term of the previous lease under s. 20(1)(z).

The restrictions in Regulation 1100(11) are not applicable to the deduction of a terminal loss.

In order for an amount paid for landscaping around a structure to be deductible, the payor must be the owner of the property at the time the landscaping is done. Accordingly, if a partnership acquires the property after completion of the landscaping, the partnership will not be entitled to the deduction even if part of the purchase price for the property is allocated to landscaping.

(a)

Regarding what is a commission, CRA noted that Rio Tinto had stated that this term refers to “an amount calculated on a percentage basis, but went on to state:

The fact that a commission is an amount calculated by reference to a percentage does not mean that any form of percentage-based remuneration satisfies that definition or that any form of remuneration determined otherwise than by reference to a percentage is deductible pursuant to paragraph 20(1)(bb).

(b)

Does CRA still maintain its position in 9017855, that where a fee is paid to the taxpayer’s securities dealer or investment advisor allowing the taxpayer to make a specified number of trades with no additional charge until the threshold was exceeded, the taxpayer must determine the fair market value ("FMV") of the advice, administration and management services received, and only the excess is considered commissions that are therefore not deductible under s. 20(1)(bb)? Before directly responding, CRA noted that “in order for an amount paid to a securities dealer to be deductible pursuant to paragraph 20(1)(bb), the principal business activity of the securities dealer should at a minimum include the provision of services in respect of the administration or management of securities,” and then stated:

In such circumstances, it is the CRA's view, based on the Rio Tinto Alcan decisions, that it is not appropriate to determine the FMV of advisory, administrative or management services. … [S]uch fees would be fully deductible pursuant to paragraph 20(1)(bb) provided that they are reasonable in relation to the services received and that they are in respect of the administration or management of shares or securities.

(c)

Does the principal business activity of a person or partnership carrying on a financial services business and providing insurance, investment and lending services include the provision of services in respect of the administration or management of shares or securities even if the provision of such services represents less than 50% of its total activities? CRA responded:

While services in respect of the administration or management of shares or securities must be part of the person's principal business, other activities may also be carried on in the same business.

Accordingly, the principal business of a person carrying on a financial services business and offering insurance, investment and lending services is, inter alia, providing services in respect of the administration or management of shares or securities even if the activities relating to those investment services alone represent … less than 50% of the person's total activities.

… [A] person licensed by one of the Canadian Securities Administrators to advise on the advisability of buying or selling certain shares or securities or to provide services in respect of the administration or management of shares or securities may be presumed to satisfy the "principal business" condition.

(d)

Is it CRA’s position that fees paid to an investment dealer are not deductible under s. 20(1)(bb) since the principal business of an investment dealer is not advising as to the advisability of buying or selling shares or securities? CRA responded:

[I]t is reasonable to assume that the principal business of a person licensed as a securities dealer is to advise on the advisability of purchasing or selling shares or securities or to provide services in respect of the administration or management of shares or securities.

In indicating that investment counselling fees paid in respect of securities of an RDSP are not deductible if they are paid by the RDSP holder, CRA stated:

One of the requirements for a deduction under paragraph 20(1)(bb)...is that the amount must be paid either for advice for purchasing or selling a specific share or security of the taxpayer or for services in respect of the administration or management of shares or securities of the taxpayer. Accordingly, this requirement would not be satisfied if the amount was paid by someone other than the owner of the shares or securities.

After quoting authorities on the meaning of "security," including a statement in Canadian & Foreign Securities Co. v. M.N.R., [1972] C.T.C. 391 at 395, 72 DTC 6354 at 6356 (F.C.T.D.) referring to "instruments for the payment of money," the questioner submitted that "segregated funds should be considered ‘securities' within the popular sense or commercial meaning of the term." CRA responded:

A segregated fund policy is a contract of insurance and … is not a share or security of the taxpayer. Consequently … paragraph 20(1)(bb) … does not apply to fees paid by a taxpayer in respect of the advisability of the acquisition or disposition of segregated fund policies, or for the administration or management thereof as the requirements of that paragraph are not met.

Where the trustee pays, on behalf of the trust, fees for advice as to the advisability of purchasing or selling securities in respect of the administration or management of the shares or securities in respect of the administration or management of the shares or securities held by a trust, to another person described in paragraph 20(1)(bb) of the Act, any reimbursement by the trust to the trustee for such fees may be deductible to the trust under paragraph 20(1)(bb) of the act provided the requirements in paragraph 20(1)(bb) of the Act are otherwise fully satisfied.

A performance fee break (based on percentage increases in the fair market value of the portfolio that was being managed) might be deductible, depending on the circumstances, under s. 9 in computing income from a business or property, or be deductible under s. 20(1)(bb).

A bidder, who did not yet own all the shares of a particular corporation and obtained the services of an investment banker on a commission basis to acquire the remainder of the shares, would not be entitled to claim a deduction under s. 20(1)(bb) with respect to the commission paid by it. That expense would be added to the adjusted cost base of the acquired shares.

Regarding expenses incurred by a mutual fund trust (or mutual fund corporation) in the course of a process of evaluating the acquisition of property at the end of which no acquisition is made, CCRA stated:

Paragraph 20(1)(bb) allows for the deduction of fees paid to a person for inter alia obtaining the person's advice on the advisability of purchasing or selling specific shares or securities. In this regard, it is important to note that it is not necessary for such advice to result in an actual acquisition or disposition for the fees paid for such advice to be deductible (see document # E 9607657). Consequently, an expense of a capital nature incurred in the course of a share or security valuation process may, even if no acquisition results, be deductible pursuant to paragraph 20(1)(bb), to the extent that either of the conditions set out in subparagraph 20(1)(bb)(iii) or (iv) are satisfied.

An administrative fee paid by a shareholder on becoming an accountholder would be a capital expense that was an addition to the ACB of the holder’s shares rather than a deductible expense given that the shares were not acquired for the purpose of generating property income and could only generate capital gains.

S.20(1)(bb) is applicable to taxpayer seeking to buy or sell, or obtain services, and not to a corporation whose issued and outstanding shares were being sold. Accordingly, s. 20(1)(bb) would not be available to provide a deduction to a corporation in respect of expenses incurred in response to a takeover bid.

Regarding the deductibility pursuant to s. 20(1)(bb) of fees paid by a taxpayer to a portfolio supervisor, CCRA stated:

Where the principal activity of a taxpayer is to act as an intermediary between taxpayers and their portfolio managers, we are of the view that the person does not appear to be offering services in connection with the administration or management of shares or securities but rather in connection with advisory and recommendation services with respect to the manager. Consequently, fees paid to such a person would not be deductible pursuant to paragraph 20(1)(bb).

After finding that the cost of subscribing to Internet services, including the cost of renting a modem, incurred to access financial information on market trends in order to help manage investments were capital expenditure, CCRA went on to indicate that they were not deductible under s. 20(1)(bb).

"Since the duties of the Public Trustee appear to exclusively involve the handling of a taxpayer's assets rather than the management of shares or securities, generally, the provisions of paragraph 20(1)(bb) of the Act are not met."

"The preamble of paragraph 20(1)(bb) of the Act specifically excludes amounts paid as commissions. Accordingly... a transaction fee related to a specific number of trades and not expressly for services in respect of the administration or management of shares or securities of the taxpayer would not be deductible ...".

Because both legal and beneficial ownership of securities for which advice or services have been provided, must belong to the taxpayer claiming the deduction, the annuitant of an RRSP cannot claim a deduction for mortgage administration fees paid by him in respect of the RRSP under s. 20(1)(bb), although administration fees which relate to the overall direction in management of the affairs of the plan trust may be deductible under s. 18(1)(a).

Where a client of a brokerage house is charged an all-inclusive monthly or annual amount, it is incumbent upon the client to determine the amount of the fee that meets the requirements of s. 20(1)(bb) by demonstrating the fair market value of any investment advisory or portfolio management services that are included. Because a full-service broker's usual commission would ordinarily entitle the client to some advice, the elimination from a periodic fee of an amount in respect of commissions based on rates charged by discount brokers would not provide a reasonable basis for estimating the value of the investment advisory portfolio management services.

This was a follow-up query on 2012-0437831E5, indicating that voluntary disclosure costs were not deductible, as they were neither incurred to earn income from business or property, nor in relation to an objection or appeal. After confirming this position, CRA stated:

However, where a taxpayer earns income from a business, the cost of making a voluntary disclosure relating to that business may be deductible as a cost of representation pursuant to paragraph 20(1)(cc).

Auditor fees incurred in connection with a proposed conversion of a corporation into an income fund which did not proceed were not deductible under s. 20(1)(cc) as no report was actually issued to a securities commission or other public body.

After noting that “CRA considers that expenses of making a voluntary disclosure…would generally not be made or incurred by the taxpayer for the purpose of gaining or producing income from a business or property,” CRA stated (TI translation):

[W]here a taxpayer earns income from a business, the expenses of making a voluntary disclosure that relates to that business could be deductible as expenses of making representations to a government under paragraph 20(1)(cc).

Respecting the determination of ACB of where a medical doctor acquired land and constructed a building that is used to earn business income, CRA stated:

[G]enerally all of the outlays and expenses incurred in respect of the acquisition of the land and construction of the building will be considered incurred on account of capital, and consequently, will constitute part of the ACB of the particular properties. You should note, however, that subsection 20(1) of the ITA could allow the deduction of an otherwise capital amount in computing a taxpayer's income from a business. Examples include paragraph 20(1)(aa): amounts paid for landscaping of grounds, paragraph 20(1)(cc): amounts paid for expenses of representation, paragraph 20(1)(dd): amounts paid for site investigation, and paragraph 20(1)(ee): amounts paid for utility service connections. Where otherwise capital amounts have been deducted in computing income from a business, the amounts are not included in the ACB of a particular property.

In the course of starting up a business, the taxpayer incurred expenses to develop an invention and obtain a temporary patent. CCRA stated:

[I]t is possible that some of those expenses may be deductible pursuant to paragraph 20(1)(cc) as expenses incurred and paid to take steps in respect of a business carried on by a taxpayer to obtain a patent from a government of a country even though they are capital expenditures. The costs of a patent agent, provisional patent application and consulting lawyers could correspond to such costs. However, since those fees form part of the capital cost of the patent, the amount deducted pursuant to paragraph 20(1)(cc) is deemed, pursuant to subsection 13(12), to have been allowed as capital cost allowance.

In response to an inquiry respecting the deductibility under s. 20(1)(cc) of legal costs incurred by farmers, in connection with making representations to the Ontario Municipal Board, supporting the rezoning of their farm property from rural to agricultural status, CRA stated:

In our view, the Ontario Municipal Board is a municipal or public body performing a function of government. Therefore, legal fees paid, in connection with making representations to the Ontario Municipal Board, relating to a business carried on by a taxpayer, would be deductible in the year paid under paragraph 20(1)(cc) of the Act. Paragraph 20(1)(vv)

Representation costs respecting the obtaining of a five-year CRTC licence would represent part of the capital cost of acquiring such an asset and are not deductible under s. 20(1)(cc).

Expenses incurred by a taxpayer in making representations to the Copyright Board will be deductible provided the representations relate to a business carried on by the taxpayer. Expenses of appealing a decision of the Copyright Board to the Federal Court of Appeal will not be deductible under s. 20(1)(cc), although in certain circumstances they may be deductible under s. 9(1).

A corporation received a $40,000 loan under the Canada Emergency Business Account (“CEBA”) program in its taxation year ending December 31, 2020, and used the proceeds to pay salary expenses incurred in that year or, alternatively, the following year. The loan (which initially is non-interest-bearing) might be repaid as required (i.e., 75% by December 31, 2022, so that $10,000 is forgiven), or might not be repaid until thereafter, in which case, the outstanding balance of the loan is converted into a three-year term loan at an annual interest rate of 5%. In describing the consequences, CRA indicated:

• The financial institution making the loan would reasonably be viewed as a person described in s. 12(1)(x)(i), and the forgivable portion of the loan would be included in income for the corporation’s taxation year ended December 31, 2020 under s. 12(1)(z)(iv) as assistance in the form of a forgivable loan in respect of an outlay or expense (the salaries).
• The corporation, to avoid the s. 12(1)(x) income inclusion, could file the s. 12(2.2) election with its income tax return for its 2020 taxation year to reduce the amount of non-deferrable operating expenses (“whether deductible or not”) incurred in that year, the subsequent year or a prior year.
• Where the intent of the parties (the corporation and the financial institution) is that any amount repaid by the corporation will be applied first in repayment of the portion of the loan that was initially forgivable, the corporation could claim a deduction under s. 20(1)(hh) with respect to the amount reimbursed in the taxation year in which the reimbursement is made, up to the amount included in its income pursuant to s. 12(1)(x).
• If the intent of the parties is unclear in that regard, the deduction under s. 20(1)(hh) would be equal to that proportion of the amount reimbursed in the taxation year that the portion of the loan that was initially forgivable is of the outstanding balance of the loan as at January 1st, 2023, due to the fungible character of the borrowed money. Under this approach, the total amount of the deduction under paragraph 20(1)(hh) will be equal to the amount of the income included under s. 12(1)(x) when the borrowing of $40,000 is fully reimbursed.

A taxpayer incurred what it viewed as a currently deductible expense of $100,000 and paid GST and QST thereon of $7,000 and $8,000, for which it claimed input tax credits (ITCs) and input tax refunds (ITRs), respectively. What is the ITA treatment of such ITC and ITR amounts if CCRA subsequently denied the expense deduction, as well as denying the ITC and ITR claims?

The Directorate noted that the ITC and ITR amounts would be considered government assistance pursuant to s. 248(16) (regarding the ITCs) and s. 12(1)(x) (regarding both), so that the taxpayer could elect pursuant to s. 12(2.2) to reduce such expenditures, and so that, pursuant to s. 12(1)(x)(vii), there would be no income inclusion.

On the repayment of the ITC and ITR amounts, s. 20(1)(hh)(ii) would allow their deduction if by reason of s. 12(2.2) they had not been included in income.

If the s. 12(2.2) election had been made, since the amount of the claimed expenses would be deemed to have been $100,000, only that amount would be denied by CRA and, as noted, the repayment of the ITC and ITR amounts would result in a further $15,000 deduction pursuant to s. 20(1)(hh)(ii). If no such election were made, so that there was an income inclusion pursuant to s. 12(1)(x), repayment of the ITC and ITR amounts would generate a deduction pursuant to s. 20(1)(hh)(i).

Background

Xco, whose principal business is mineral exploration and mining, and which owns the “Mine,” is wholly-owned by a listed public corporation (“Parentco”). The Province is not currently requiring either Xco or Parentco to carry out any material reclamation works on the Mine.

Proposed transactions

A limited partnership (the “Partnership”) has been formed to secure funds, which it will raise from accredited investors subscribing for Partnership units, to assist in the reopening of the Mine. The general partner’s shareholders and directors deal at arm’s length with Xco and the limited partners. The Partnership will enter into a joint venture (“JV”) agreement with Xco, which will provide for most Mine related expenditures to be made pursuant to the JV Agreement and provide for the formation of a reclamation trust (the Reclamation Trust”) to satisfy all the reclamation obligations imposed respecting the Mine. Under the JV Agreement, Xco will be the initial JV operator (with exclusive authority to make all decisions relating to day-to-day operations, but with major JV decision decided by majority decision of a JV committee with equal Xco and Partnership representation, and with the Partnership representative to have the casting vote for all major decisions until the completion of the Mine reopening). During the term of the JV:

(a) the Partnership will be entitled to a share, that varies depending on the total cash contribution of the Partnership to the Reclamation Trust described below, of the net gross revenue of the Mine production during the term; and

(b) Xco will be entitled to the share of the net gross revenue of the production of the Mine not allocated to the Partnership.

The JV Agreement provides that the operator will provide an indemnity (on typical industry terms) to the non-operator (the Partnership) respecting any liability resulting from any acts or omissions of the operator respecting the Mine.

Under the terms of the JV, the Partnership will make a cash contribution to the Reclamation Trust, for which it is a co-beneficiary with the Mine operator (Xco) and the Province, in order to satisfy reclamation obligations of up to a specified dollar amount.

A put/call agreement will be entered into between the Partnership and Parentco. The exercise price for the call right of Parentco is based on 10-day weighted average closing price for its shares ending prior to the exercise of its call and in aggregate will reflect the amount of contributions made by the Partnership to the Reclamation Trust. The put price is based on the appraised value of Partnership units.

Rulings

Provided that the Reclamation Trust is a "qualified environmental trust" as defined in s. 248(1), the contribution by the Partnership to the Reclamation Trust will be deductible in computing its income pursuant to s. 20(1)(ss).

The call and put rights will not by themselves result in a reduction of the "at-risk amount" of the Limited Partners as that term is defined in subsection 96(2.2) of the Act.

In 2001, the U.S. government began imposing countervailing and anti-dumping duties ("CADD") on the export of softwood lumber products from Canada, including by the Corporation, and required that the duties be paid - or that a bond be posted equivalent to such duties, which the Corporation did. Under its agreements with its lumber suppliers, the price it paid was reduced according to the applicable CADD rate that was being imposed, but it was further agreed that if the CADD was reversed, that amount would be refunded to the suppliers.

After a finding by the International Trade Tribunal that there was not a current material injury to the US lumber producers, the Corporation was released by the US government from its potential obligations regarding the CADD for the years 2001 and 2002, in 2002, it repaid an amount corresponding to the CADD in question to its suppliers.

In finding that the Corporation was not entitled to a deduction in 2001 for the CADD amounts pursuant to s. 20(1)(vv), and before going on to find that s. 18(1)(e) denied a s. 9 deduction, the Directorate stated:

Paragraph 20(1)(vv) … allows for the deduction of such duties as long as they are paid. … In the current context, [“paid’] … means "to discharge a debt". However, we understand that in this case, the guarantee offered to the US Government is more of a surety bond in which the Corporation has acquired term deposits to secure the performance of its obligations. Consequently, we are of the view that the provisions of paragraph 20(1)(vv) do not apply … .

Although, where an individual is subject to the tax on split income (“TOSI”) under s. 120.4(2) for a particular year, and the amount of split income is also included in the individual’s income under Division B of Part I, double taxation is avoided pursuant to s. 20(1)(ww), which provides a deduction, in computing an individual’s income from a business or property, for an amount equal to that of the individual’s split income. Where an individual recognizes a capital gain of $200,000 in the year, with the $100,000 taxable capital gain being included in the individual’s split income, and the individual realized a capital loss of $200,000 in the same taxation year from an unrelated transaction, would the individual be able to claim an s. 20(1)(ww) deduction for the taxable capital gain included in split income?

In confirming the availability of the deduction, CRA noted that the Department of Finance explanatory notes indicate that the purpose of paragraph (ww) is to ensure that individual’s split income is excluded from the individual’s income that is otherwise subject to tax. Accordingly, in the circumstances described, CRA would not challenge the deduction under paragraph (ww) for any portion of an individual’s split income that relates to the taxable capital gain.

An amount, which is included in the income of an individual (X) under s. 15(2) is also subject in the individual’s hands to the tax on split income (TOSI) under s. 120.4(2) (TOSI), so that X is entitled to a deduction under s. 20(1)(ww) for the income subject to TOSI (being also equal to the s. 15(2) income inclusion).

In a subsequent taxation year, X repays the shareholder loan. CRA indicated that having claimed the s. 20(1)(ww) deduction would not preclude X from subsequently claiming the s. 20(1)(j) deduction when the loan was repaid – and indicated that this appeared to be the right policy result.