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Unformatted text preview: “in connection with” or “incidental to” are not defined in the protocol. at the 2008 iFa seminar, the Cra’s initial comments seemed to suggest that Canadian case law that interpreted the meaning of in connection with or incidental to income from an active business was relevant in considering the scope of 30 Treas. reg. 1.367(a)-2T(b)(3). 31 Dominion Taxicab Assn. v. MNR, 54 DTC 1020, at 1021 (sCC); and Canadian General Electric
Co. Ltd. v. MNR, 61 DTC 1300 (sCC). see also the discussion in Wilfrid Lefebvre, ian Macgregor, and Deen C. Olsen, “income Tax Litigation” (1995) vol. 43, no. 5 Canadian Tax
Journal 1861-79, at 1873. i nternational tax planning n 99 this provision.32 such a response suggests a fairly narrow interpretation of these terms. However, the technical explanation does elaborate on the requirement that income from the source country must be derived in connection with or incidental to the trade or business carried on in the resident country. In Connection with
an item of income is derived in connection with a trade or business if, for example, the income-producing activity in the source country...
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