Safar-Zadeh v. The Queen (March 7, 2017 – 2017 TCC 35, Jorré).
Précis: Mr. Safar-Zadeh applied for a GST/HST new housing rebate in respect of a home (the “161 Shirrick Property”). The agreement of purchase and sale was entered into in June of 2011 and the sale closed on 21 November 2012. Five or six months later the property was sold at a profit. After an extensive review of the facts the Court concluded that Mr. Safar-Zadeh had not intended to acquire the 161Shirrick Property as a primary residence since he and his wife did not have the income to maintain it. As a result the appeal was dismissed. There was no order as to costs since this was an informal procedure appeal.
Decision: This was a case replete with odd little details. The 161 Shirrick Property was at the opposite end of the same block as a house (215 Shirrick) owned by Mr. Safar-Zadeh for a number of years prior to closing of the 161Shirrick Property. His evidence was that he rented the former residence to his brother-in-law, Yusuf, for an all-inclusive monthly rent of $1,800 and slowly moved into the 161 Shirrick Property. The Court’s primary driving factors in dismissing the appeal were economic, i.e., on the evidence he and his wife did not seem to have the means to maintain the new property:
 In 2010, the year before the agreement of purchase and sale of 161 Shirrick, the Appellant and her husband reported, approximately, gross income of $34,000. In 2011, the year of the agreement of purchase and sale, the Appellant and her husband reported, approximately, gross income of $14,500. In 2012, the year the Appellant closed the purchase of 161 Shirrick the Appellant and her husband reported, approximately, gross income of $16,400. In 2013, the Appellant and her husband reported, approximately, gross income of $13,125.
 The Appellant and her husband could not have had much in savings as they were obliged to borrow the entire $40,000 in deposits from Ebrahim [the brother-in-law of the taxpayer’s wife]. It is hard to imagine how they, a family of two adults and two children, could afford to buy a house for about $500,000 and then spend $50,000 on additional work with an income of $34,000 let alone an income of $16,400, particularly when they had no plan to sell their old house at 215 Shirrick.
 While Ebrahim did not charge them interest, they would still have had to pay substantial mortgage interest on an amount of the order of $450,000.
 While the $1,800 a month in rent paid by Yusuf would help the Appellant and her husband, the actual amount available for them to help pay for the new house would be less since his rent was all inclusive and would have to cover heat, electricity, water, insurance and property taxes for 161 Shirrick. Whatever was left over could help, but the Appellant and her husband faced substantial additional costs in their new home; a mortgage with a $450,000 principal could easily result in mortgage payments of $1,000 per month or more.
 Given the relatively low gross income reported by the Appellant and her husband, it is unlikely that the new home at 161 Shirrick was financially manageable for them.
 When Yusuf testified about his moving out of 215 Shirrick he stated that he felt he had to move out for the safety of his niece and nephew given “. . . the way they explained it to me what was going on in that neighbourhood”. (My emphasis.) The quoted passage is odd. At the time Yusuf would have been asked to move out, he was living at the other end of the block; as such it is strange to refer to “that neighbourhood”.
 The terminology Yusuf used is more consistent with living in another neighbourhood than with living at the other end of the block.
 For all these reasons, I am not persuaded that the Appellant bought the property at 161 Shirrick with the intention of using it as the family’s principal place of residence. Accordingly, the appeal is dismissed without costs.
As a result the appeal was dismissed. There was no order as to costs since this was an informal procedure appeal.