http://decisions.fca-caf.gc.ca/fca-caf/decisions/en/item/232649/index.do
Klundert v. Canada (June 21, 2017 – 2017 FCA 134, Dawson, Webb (author), Rennie JJ.A.).
Précis: This is likely almost the tail end of the Klundert saga. Mrs. Klundert’s husband, a tax protester optometrist, directed Ontario Health Insurance Plan payments to her bank account at a time when he owed substantial amounts of in income tax. CRA assessed Mrs. Klundert pursuant to subsection 160(1) and she appealed unsuccessfully to the Tax Court. She appealed to the Federal Court of Appeal and her appeal was dismissed from the Bench, with costs.
Decision: This case simply boiled down to the fact that Mrs. Klundert’s counsel could not demonstrate any reversible error:
[5] The Tax Court Judge found that the deposits made to Ann Klundert’s bank account were transfers made to her by Dr. Klundert as they were payments by OHIP for his services and she was the legal and beneficial owner of these funds once they were deposited into her account. In this appeal Ann Klundert raises the same arguments that were raised before the Tax Court. We have not been persuaded that the Tax Court Judge committed any error in determining that the funds became her property when they were deposited into her bank account and therefore that Dr. Klundert transferred property to her by directing OHIP to make these deposits.
[6] The liability of Ann Klundert under paragraph 160(1)(e) of the ITA is limited to the lesser of:
(a) The amount by which the fair market value of the property transferred to her exceeds the consideration given by her for the property; and
(b) The total liability of Dr. Klundert under the ITA in respect of the taxation year in which the property was transferred or any preceding year.
[7] There was no dispute that the relevant deposits to Ann Klundert’s bank account totaled $959,403. There was also no dispute that Dr. Klundert’s relevant tax liability was $145,367 as of 2012. Therefore, in order for the limiting amount to the amount based on the fair market value of the property transferred, the amount of the consideration given by Ann Klundert would have to be in excess of $800,000. In light of this, Ann Klundert did not pursue her arguments related to the consideration.
As a result the appeal was dismissed from the Bench, with costs.