The appellant appealed a tax assessment that disallowed $33,653 in legal, accounting, and professional fees claimed as business expenses.
The fees were incurred to wind up an Individual Pension Plan (IPP) to comply with a family court order following a marriage breakdown.
The Tax Court of Canada dismissed the appeal, finding that the expenses were personal in nature and not incurred for the purpose of earning income from a business or property.
Furthermore, the Income Tax Act specifically disallows the deduction of legal expenses relating to the division of a pension plan arising out of a marriage breakdown.
