Classic International Tax Case: Dudney v. The Queen 1998

Par Robert Robillard - 14 juillet 2014

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In Dudney v. The Queen, 1998 CanLII 323 (TCC), the taxpayer states that it does not have a « fixed base regularly available to him » in Canada. CRA argues that he does. The appeals are allowed: the assessments of the taxpayer are vacated.


« [1] These appeals are from assessments for income tax for the taxation years 1994 and 1995. Their subject matter is the proper interpretation to be given to the words « fixed base » found in Article XIV of the Canada-U.S. Income Tax Convention (1980) (the Convention). It is agreed between the parties that the Appellant was a resident of the United States of America, and not a resident of Canada, during all of the relevant time period. He worked in Calgary, Alberta, under a personal service contract for about 300 days in 1994, and for about 40 days in 1995. What I am required to decide is whether the income that he earned under that contract is to be taxed in Canada under the words of Article XIV, which reads:

Article XIV Independent Personal Services

Income derived by an individual who is a resident of a Contracting State in respect of independent personal services may be taxed in that State. Such income may also be taxed in the other Contracting State if the individual has or had a fixed base regularly available to him in that other State but only to the extent that the income is attributable to the fixed base.

The only matter in dispute is whether or not the Appellant « had a fixed base regularly available to him ». The Appellant says that he did not; the Respondent argues that he did. »

The appeals were allowed, and the assessments were vacated.

To see the full transfer pricing case click here.

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Dudney v. The Queen, 1998 CanLII 323 (TCC)

Dudney c. La Reine, 1998 CanLII 323 (CCI)

Robert Robillard, CPA, CGA, MBA, M.Sc. Econ.
Transfer Pricing Chief Economist, RBRT Inc.
514-742-8086; robert.robillard « at » localhost

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