Mr. Auclair was a pilot. His employer had him take a course to qualify for piloting a particular plane. The course cost $12,000 and, because he quit the employer early, he had to pay $9,000 of that course fee. He deducted the cost as an employment expense for his 2010 tax year.
You can deduct the cost of supplies you consume in your work, where your employment contract demands that you pay for them. (See ITA s. 8(1)(i)(iii).) Mr. Auclair claimed that his course was that kind of deductible “supply”.
This was an interesting argument but usually education is considered “capital” because it gives you something of enduring value–knowledge and skill. Expenses, such as deductible supplies, are not like education and other capital property. Supplies expire; they’re used up, like clothing, paper, and electricity. We allow you to deduct these expenses from your income because they’re a cost of earning it. So, Justice Masse didn’t allow Mr. Auclair’s deduction; it wasn’t an expense; it was an asset.
To read the decision in its original French: Auclair v. The Queen (2013 TCC)