http://decision.tcc-cci.gc.ca/tcc-cci/decisions/en/item/109832/index.do 
Zhao v. The Queen (May 14, 2015 – 2015 TCC 124, Masse D.J.).
Précis: The taxpayer received a promotion from his employer. He moved closer to his place of employment and sought to deduct his moving expenses. The Court held that in order to be deductible the move must be to a “new” place of employment and dismissed the appeal.
Decision: The facts of this case are straight forward:
[2] The factual context for this matter is quite straightforward. Prior to May 2012, the Appellant resided in the Greater Toronto Area. His address was 24 pale Moon Crescent, Toronto, Ontario.
[3] He was working for Mold Masters (2007) Ltd. (“Mold Masters”) as an hourly paid CAM Programmer, a skilled technical position. Mold Masters is situated at 233 Armstrong Avenue, Georgetown, Ontario.
[4] On May 30th, 2012, Mold Masters offered the Appellant an internal company promotion to become a CAD/CAM Developer in the CAM department, to take effect June 11th, 2012 (see Exhibit A-1). On May 31st, 2012, the Appellant accepted this promotion. Exhibit A-1 describes the new position as a “lateral transfer” in the same department. The Appellant continued to report to the same person as before and “all terms and conditions outlined in the Employment Agreement signed by you on March 13th, 2010 remain unchanged and therefore in full force and effect”. However, the Appellant went from an hourly rated position to a salaried position. The CAM department is the same department he was working in previously but now involved some increased responsibilities. The Appellant, in his new position, was still required to report to and work at the Georgetown facility. The Appellant believed that, by virtue of his expanded responsibilities, he should move closer to his work location. Consequently, on June 1st, 2012 he moved his family to Milton, Ontario. It is clear that he had committed to this move prior to accepting his promotion. His new address was 396 Kincardine Terrace, Milton, Ontario.
[5] It is not disputed that the distance between the Appellant’s old residence and his work location is more than 40 kilometres greater than the distance between the Appellant’s new residence and work location as a result of his relocation. It is also not disputed that the location of the Appellant’s place of work did not change either before or after his promotion or after his move to the Milton residence.
[6] There is no evidence that the Appellant would have lost his employment or his opportunity for a promotion if he did not move. There is no evidence that Mold Masters required the Appellant to move in order to continue working there in his new position. The Appellant moved because he believed that he should be closer to work, not because he had to.
The decision turned on a split in the jurisprudence with two earlier Tax Court cases requiring that the move be two a “new” place of employment and one Tax Court decision holding that was not necessary. In this case the Court preferred the former line of reasoning:
[15] I find the reasoning of Justice Favreau in Langelier, supra, to be most persuasive. I am of the view that Parliament has intentionally chosen to use the word “new” in the expression “new work location” as used in the definition of “eligible relocation” in subs. 248(1) and subs. 62(1) of the Act. The expression “the new work location” appears several times in both subs. 62(1) and subs. 248(1) of the Act. Each word in an enactment must be given meaning. It cannot be concluded that the word “new” as used in these provisions of the Act are merely surplusage. Had Parliament intended the phrase “new work location” to mean “a location in Canada where the taxpayer is employed” then Parliament would have so stated without resorting to unnecessary descriptive words like “new”. Had Parliament so intended, it would have removed the word “new” from subs. 248(1) and subs. 62(1) at the same time it enacted the amendments in 1984 and in 1999. Parliament chose not to do so and so it must have intended for the word “new” to have some meaning. I am of the view that the word “new” must mean a different work location. To repeat Justice Favreau’s dictum in Langelier, supra, “I do not believe that Parliament’s intent was to permit a taxpayer to deduct moving expenses in circumstances where a taxpayer performed new duties with the same employer at the same business location.” This is exactly the situation that we have at hand. The Appellant in the case at hand got a promotion, which involved the performance of new duties, but he was with the same employer and he worked at the same location.
As a result the appeal was dismissed.
TAGS: Income Tax Act, Tax Litigation, Deductible Expenses, Moving Expenses