https://decisia.lexum.com/tcc-cci/decisions/en/item/305789/index.do
Isah v. The Queen (January 31, 2018 – 2018 TCC 28, Russell J.).
Précis: The taxpayer claimed charitable donations in each of 2009, 2010 and 2011 to World Vision Canada and Heart and Stroke Foundation of Canada. CRA denied the donation claims and imposed gross negligence penalties for the 2011 taxation year. The taxpayer’s appeal to the Tax Court was dismissed. There was no order as to costs since this was an informal procedure appeal.
Decision: The Tax Court found that the disputed donations were simply fictitious:
[10] It readily appears from the un-contradicted evidence brought by the Respondent that the World Vision and Heart & Stroke donations purportedly made by or on behalf of the Appellant for his 2009, 2010 and 2011 taxation years had in fact not been made. The evidence of Mr. Mitchell of World Vision and Ms. Brown of Heart & Stroke establish that the donation receipts that the Appellant’s tax return preparer Mr. K had included in the Appellant’s returns for those three years, ostensibly from those two respected charitable institutions, were fictitious. As well, the Appellant made no effort to deny that these donation claims were falsely made. He was forthright in saying he never gave the tax return preparer Mr. K funds in the amounts fraudulently claimed as deductions, to gift on his behalf to World Vision and Heart & Stroke. I add that while he knows now of these fraudulent claims, it has not been established that the Appellant had actual knowledge of these wrongful claims at the times they were advanced. But in whole I find that the Minister’s appealed reassessments denying these claimed charitable donations are correct.
On the evidence the Court found that the gross negligence penalty imposed for the 2011 taxation year of the taxpayer was justified:
[15] In this case however the mis-statements in the 2011 return are the claims for deduction for charitable donations to World Vision and to Heat & Stroke in the respective amounts of $2,533.86 and $2,464.08. I do not think the Appellant, who represented himself in this matter, would have had a problem in spotting these wrong amounts if he had taken time to review the return (as he said he did not) before signing it. I think that these two false statements would have been obvious to him, as they would have been to almost anyone in reviewing that return. The Appellant was completely aware that he had had no intention of donating any such amounts to these two charitable institutions.
As a result the taxpayer’s appeal to the Tax Court was dismissed. There was no order as to costs since this was an informal procedure appeal.