The appellants claimed business losses from a barbecue and catering venture for the 2008 to 2014 taxation years.
The Minister denied the losses, arguing there was no source of income, reassessed statute-barred years, and imposed gross negligence penalties.
The Tax Court found that the appellants' activities were initially a personal hobby and skill development, but evolved into a business by 2012.
The court held the Minister could not reopen the statute-barred 2008-2011 years as there was no misrepresentation, and vacated all gross negligence penalties.
For 2012-2014, the court allowed the business losses but reduced the claimed expenses as they were unreasonably high.
