Can interest on a loan be deducted if the loan was no longer operated at the time of the loan?
Canada (Federal), Canada
The following excerpt is from Deslauriers v. The Queen, 2002 CanLII 882 (TCC):
In her view, if the business was no longer operated at the time of the loan, the interest on that loan was no longer deductible since the use of that loan did not constitute an eligible purpose. The borrowed money was not used to earn income (see Bronfman Trust v. Canada, 1987 CanLII 76 (SCC), [1987] 1 S.C.R. 32).
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