http://decision.tcc-cci.gc.ca/tcc-cci/decisions/en/item/144653/index.do
Crete v. The Queen (May 27, 2016 – 2016 TCC 132, Smith J.).
Précis: Ms. Crete separated from her ex-spouse in early 2012 and thereafter she and he ex-spouse shared custody of their children. She continued to receive Canada Child Tax Benefits as before until 2014 when, in response to a CRA request for confirmation of her status, she indicated that he was a shared-custody parent (in addition, CRA admitted that she had specifically informed CRA of the shared custody arrangement in late 2013). As a result of that she was assessed for overpayments of Canada Child Tax Benefits (and related GST Credits). She did not deny the overpayments but alleged that she had informed CRA of her change in status in 2012 shortly after her separation. The Tax Court concluded that there was no estoppel against the statute. As a result her appeal was dismissed. There was no order as to costs since this was an informal procedure appeal.
Decision: The facts of this case were straight forward:
[5] In order to establish and maintain the redeterminations noted above, the Minister relied on the following assumptions of fact:
1. That the Appellant and her ex-spouse are the parents of J. born in 1999 and S. born in 2001;
2. That on or about November 3, 2014, the Appellant informed the Minister that on March 27, 2012, she had separated from her ex-spouse and that they shared custody of their two children;
3. That since the date of separation, the Appellant and her ex-spouse have shared custody of their two children on a fifty percent basis.
[6] With the exception of the date of notice set out in item 2 above, the Appellant does not dispute these assumptions nor, as indicated above, does she dispute receipt of the overpayments as follows:
GSTC – 2010, 2011 and 2012 taxation years
|
2010
|
$59.73
|
April 2012
|
|
2011
|
$211.32
|
July 2013 to April 2014
|
CCTB – 2011, 2012 and 20913 base taxation years
|
2011
|
$3,456.50
|
July 2012 to June 2013
|
|
2012
|
$3,525.50
|
July 2013 to June 2014
|
Ms. Crete alleged that she had informed CRA of her change of status in 2012 shortly after her separation.
[8] The Appellant was the only witness at the hearing. It was her position that she called the Canada Revenue Agency (“CRA”) on several occasions following the date of her separation and informed them of her marital status. She was unable to provide the name of any official and acknowledged that she had simply called the so-called “1-800” number. During cross-examinations, she admitted that she had not specifically spoken to anyone in the child benefits section but emphasized that in any event, she had listed her marital status as “separated” in her 2012 tax return.
[9] On May 17, 2013, she received a cheque for $8,790.53 which she deposited in her bank account (she produced the CRA envelope where she had inscribed the date of receipt). According to the Appellant, she immediately called CRA to ensure she was entitled to the monies received and was given assurances that the payment represented a retroactive payment to the date of her separation. In November 2013, she again informed CRA of her marital status and, in due course, filed her income tax return for the 2013 calendar year again confirming that status.
While the Court accepted that there had been an administrative error on the part of CRA in issuing the overpaid Credits it held that Ms. Crete was not entitled to relief as a result:
[30] While the Minister has admitted that the overpayments made to the Appellant were the result of an administrative error, in fairness to CRA, it should be recognized that they were only informed of her shared-custody status in November 2013.
[31] One more piece of the puzzle is missing. The father did not testify at the hearing and, apart from his signature on the type-written note of January 18, 2015, no evidence was adduced as to what information, if any, he provided to CRA.
[32] This leads me to conclude that there was an arrangement that the father would not be required to make support payments as long as the Appellant continued to receive the CCTB and related benefits. Had that not been the case, it is more than likely that the father, as a “shared-custody parent”, would have filed an application for his share of the CCTB. Had he done so, CRA would have dealt with the shared-custody situation at a much earlier date.
[33] In the end, I agree with the Minister that CRA’s so-called error is simply not relevant and that subsection 160.1(1) of the Act is clearly intended to address a situation where an amount has been refunded in excess of the amount to which the taxpayer was entitled. While I appreciate that this might create a financial hardship and seem unfair from the Appellant’s perspective, I find that her situation is no different than that of many ordinary Canadians who diligently file their income tax return prior to April 30th and receive a refund, only to be reassessed at a later date when it comes to CRA’s attention that the initial assessment was based on incorrect or incomplete information.
As a consequence her appeal was dismissed. There was no order as to costs since this was an informal procedure appeal.