Cases
Klotz v. The Queen, 2004 DTC 2236, 2004 TCC 147, aff'd 2005 DTC 5279, 2005 FCA 158
Prints which the taxpayer purchased without seeing or taking personal possession of and then immediately donated to a Florida university were found in obiter to constitute personal-use property. The interpretation advanced by the taxpayer - that every property that was not used or held for an income-producing purpose was a personal-use property - was to be preferred. In any event, even if, as contended by the Crown, a property must actually be used or enjoyed by the taxpayer to qualify as a personal-use property, the prints here so qualified because "one way of using an object is to give it away, whether the motive be altruistic, charitable or physical."
See Also
Plamondon v. The Queen, 2011 DTC 1137 [at 746], 2011 TCC 47
Hogan J found that dried insects donated by the taxpayer to Laval University were individually appraised and did not "form an unbreakable set," and thus were not a set (as per s. 46(3), so that under s. 46(1), each insect had an adjusted cost base of $1,000. Before so concluding, he disagreed with the expansive interpretation of personal-use property in Klotz, stating (at para. 15):
In English, the ITA uses the word "primarily". The Oxford English Dictionary, third edition, defines "primarily" as follows: "to a great or the greatest degree; for the most part, mainly". Thus, the property must unequivocally be for the use and enjoyment of the taxpayer. If Parliament had wanted there to be only two types of property, it could have defined PUP as all property that is not income property However, that was not what Parliament did.
Here, the taxpayer "prepared them only for donation. There was no real use" (para. 19) (after citing Glaxo Wellcome as to "use").
Donato v. The Queen, 2009 DTC 1384 [at 2111], 2009 TCC 590
Cartoons that the taxpayer donated to Brock University were not personal-use property given that the drawings had been created by him in the course of his work as a free-lance cartoonist. However, if the drawings instead had been donated by his wife, they would have qualified as personal personal-use property.
Administrative Policy
2013 Ruling 2012-0443081R3 - Distribution of pre-72 Capital Surplus on Hand
Are non-interest bearing loans, for example to a non-resident corporation or to a non-resident child of a parent, "personal-use property" ("PUP") – so that for example they would not be "specified foreign property" in s. 233.3(1)? After citing Plamondon v. The Queen, 2011 TCC 47, and in finding that such debt generally would not be PUP, CRA stated:
[T]o qualify as PUP under paragraph (a) the property must be owned and actually used primarily for the personal use or enjoyment of the taxpayer or a related person. … A debt would normally only qualify as PUP under paragraph (b), which requires the debt result from the disposition of a property which itself was PUP.
12 February 2013 Memorandum 2012-0437211I7 F - NRT rules and subsection 164(6)
The estate of an individual was deemed to be resident in Canada. At the time of his death, the deceased held his Canadian principal residence. A capital loss also was realized on the disposition by the estate of the residence. The executor had elected under s. 164(6)(c) to carry back this and other capital losses to the terminal return of the deceased.
The Directorate referred to E2008-0280751E5 and E2002-0148955, where CRA had stated that a capital loss from the disposition of a personal residence of the deceased was eligible under s. 164(6) if it was not personal use property to any beneficiary or a related person.
2011 STEPs Roundtable Q. 10, 2011-0401871C6
a cottage owned by an estate which has not been used by any of the beneficiaries or related individuals would not be personal-use property, so that a capital loss realized by the estate on its sale would be deductible against capital gains of the estate.