In this ABIL case, Ouimet J. allowed the appeal. Hebert’s corporation hadn’t had revenue since 2007 but claimed an ABIL in 2011, the year of dissolution.
Justice Ouimet allowed the appeal on the basis that, first, the Federal Court of Appeal has said that almost any activity can constitute an active business. Second, although a corporation must have assets used in an active business (not just ones that were derived from such activity), that was the case here. The corporation had been trying to sell off its stock of radio equipment. It’s only activity was that, but Justice Ouimet said that was enough.
This case would also fit nicely with the Raegele and Poulin line of cases under ITA s. 18(1)(a), where wind down activities of a business are held to be part of the business and so they are deductible.