http://decision.tcc-cci.gc.ca/tcc-cci/decisions/en/item/109481/index.do
7547978 Canada Inc. v. The Queen (May 7, 2015 – 2015 TCC 112, Favreau J.).
Précis: The only point at issue in this appeal was whether CRA was entitled to impose penalties for a failure to file T4 slips for workers found to be employees in separate Tax Court proceedings. The Court concluded that the penalties (imposed under the Income Tax Act) were justified and dismissed the taxpayer’s appeal. There was no costs order as this was an informal procedure appeal
Decision: This case was open and shut. The Tax Court had already determined that the workers in question were employees:
[11] The appellant did not file any T4 slips for the remuneration paid to the workers even though it should have done so because the workers were employees for the purposes of the Act, as confirmed by the decision of this Court rendered today in the appeals of Maxim Meunier (2013-3117(EI)), Richard Meunier (2013-3120(EI)), and 7547978 Canada Inc. (2013-3121(EI), 2013-3122(EI), (2013-4177(EI)).
[12] The appellant filed T4A slips in respect of the 2010 and 2011 taxation years with the Canada Revenue Agency for the workers, but these slips were incorrect because the remuneration paid to the workers was described as being “Self-employed commissions” or “Fees for services” rather than as employment income and because the expense reimbursements, such as meal allowances, travel expenses, and cash advances made to the workers, were included as being part of the income earned.
[13] The Canada Revenue Agency cancelled the T4A slips prepared by the appellant and issued T4 slips to all the workers, who were reassessed on the basis of the T4 slips.
[14] Since the appellant failed to file T4 slips for its employees by the time required under section 205 of the Income Tax Regulations, the Minister was justified in imposing the penalty provided in subsection 162(7) of the Act in respect of the 2010 and 2011 taxation years.
[15] For these reasons, the appeal is dismissed.
There was no award of costs since this was an informal procedure appeal.