Are legal fees to set up a intervivios trust for tax planning deductable against the income from the trust in Canada

Answer

Taffey,

NO, set up fees are not deductable. They are the cost of doing business so to speak however.

Generally, because charges you incur in creating and implementing an estate plan -- including attorney’s fees -- are considered personal expenses, you cannot deduct them for income tax purposes.  However, fees relating to estate planning may be deductible when incurred for:  

(1) the production or collection of income;
(2) the management, conservation or maintenance of property held for the production of income; or
(3) tax advice and tax planning.  

These three types of expenses qualify as miscellaneous itemized deductions and are subject to a floor of 2% of your adjusted gross income (AGI).

Hope this helps.
Hardev
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