Blackwell v. R. - TCC: Appeal quashed as taxpayer never objected to underlying reassessment

Aug 04, 2016 By Bill Innes

Précis: The taxpayer’s Notice of Appeal purported to appeal his 2008 taxation year however he had never filed a notice of objection to the second notice of reassessment for that year. As a result the Court granted the Crown’s motion to strike the appeal. It awarded costs fixed at $625 to the Crown. In light of the conduct of Mr. Blackwell’s representative, Mr. Garrison, the Court gave him 30 days to make submissions why he should not be ordered to pay all or part of Mr. Blackwell’s costs personally.
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Hayfron- Benjamin v. R. - TCC: Taxpayer victim of identity theft, appeal allowed

Aug 04, 2016 By Bill Innes

Précis: The taxpayer was assessed for unreported employment income in the amount of $5,759 in 2011. The taxpayer was able to establish on the evidence that the amount had been depostited to the bank account of his brother, Albert, and that the taxpayer had never been employed by the employer in question. There was no order as to costs.
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Bauer v. R. - TCC: Large portions of taxpayer’s Notice of Appeal struck

Aug 03, 2016 By Bill Innes

Précis: The Crown moved to strike at least 38 full paragraphs of the taxpayer’s Notice of Appeal and portions of other paragraphs of the Notice of Appeal. The provisions in dispute all essentially attacked the conduct and motivation of CRA in assessing the taxpayer. The Court concluded that the provisions had no likelihood of success, were abusive and would unduly delay the proceedings. As a result the provisions were struck. The taxpayer was denied leave to file an amended Notice of Appeal elaborating on the disputed provisions. The Crown was given 60 days to file an amended Reply. The Crown was awarded costs fixed at $1,000.
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Klundert v. R. - TCC: Payments to wife of tax debtor physician subject to subsection 160(1)

Aug 03, 2016 By Bill Innes

Précis: This may be one of the last chapters of the Klundert litigation about a tax protesting doctor. In this case roughly $1,000,000 had been transferred at Dr. Klundert’s direction by OHIP to his wife’s account during a period when he was a tax debtor. CRA assessed Mrs. Klundert under subsection 160(1) in respect of the transfer. The Tax Court rejected the appeal with the exception of a small ($3,614.51) adjustment. Somewhat unusually, there was no order as to costs.
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Shahbazi v. R. - TCC: Court rejects receipts for charitable donations in kind

Aug 02, 2016 By Bill Innes

Précis: Mr. Shahbazi claimed to have made gifts in kind to charities in 2006 ($20,000) and 2007 ($15,000) which CRA denied and he appealed to the Tax Court. The Tax Court rejected the appeal on the basis that the receipts were deficient, i.e., they did not describe the property in kind which was allegedly donated. There was no order as to costs since this was an informal procedure appeal.
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Atlantic Thermal Star v. R. - TCC: Deductions for a bad debt and goodwill denied, costs denied

Aug 02, 2016 By Bill Innes

Précis: The taxpayer claimed a bad debt deduction in 2008 ($14,919) and a CEE deduction in 2010 ($4,996). It also claimed costs on the basis of alleged delay by the Minister. The taxpayer’s principal (Mr. Backman) did not testify; its case was put in entirely by its accountant. The Court rejected the appeal essentially on the basis that there was no evidence to demolish the Minister’s pleaded assumptions. Moreover there was no order as to costs (this was an informal procedure appeal).
Atlantic Thermal Star v. R. - TCC: Deductions for a bad debt and goodwill denied, costs deniedREAD MORE »

AFD Petroleum v. R. - FCt: Minister did not act unreasonably in refusing to accept incomplete SRED form

Jul 29, 2016 By Bill Innes

Précis: The applicant submitted a form for SRED credits to CRA. The claim was rejected because the form was not completed properly. The applicant applied to the Federal Court to review the decision of CRA. The application was dismissed; the Court found that the decision did not involve procedural unfairness. Costs were awarded to CRA.
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Thibeault v. R. - TCC: Taxpayer not engaged in a vessel leasing business in 2008 and 2010

Jul 29, 2016 By Bill Innes

Précis: The taxpayer had a number of business interests including vessels and marine permits which he held personally. In 2008 he leased one vessel and offset the rental income with a large capital cost allowance claim which resulted in a loss for tax purposes. In 2010 he sold one of his permits and against claimed capital cost allowance against the sale proceeds. CRA limited his capital cost allowance pursuant to Regulation 1100(15) to the amount of his rental income. The taxpayer argued that he was engaged in a vessel leasing business in both taxation years with the result that Regulation 1100(15) did not operated to limit his capital cost allowance claims in either year. The Tax Court found that the taxpayer was not engaged in a vessel leasing business in either taxation year and dismissed the appeal with costs.
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Canada v. 0741449 BC - FCt: Jeopardy orders granted; corporate principal had chequered financial past

Jul 28, 2016 By Bill Innes

Précis: This decision deals with the rather rare jeopardy order provision found in subsection 164 (1.2) of the Income Tax Act (this is only the third reported decision on the provision). Subsection 164(1.2) permits the Minister, with the sanction of the Court, to retain taxpayer funds in her possession that would otherwise be payable to the taxpayer where a jeopardy situation is shown to exist. The Court found that the evidence disclosed both little, if any, other assets of the respondent corporation and a history of non-payment or bankruptcy on the part of the corporate principal. As a result the jeopardy orders sought were granted. The Minister was awarded costs set at $5,000.
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Whissell v. R. - TCC: Taxpayer failed to make out due diligence defence for non-filing penalties

Jul 27, 2016 By Bill Innes

Précis: Mr. Whissell was assessed for 2006, 2007, 2008, 2009 and 2010 in respect of unreported income. He was assessed penalties under subsection 163(1) for each of 2007, 2008, 2009 and 2010. The sole issue before the Tax Court was the imposition of these penalties. The Court held that he had not made out a due diligence defence. All of the appeals with the exception of 2006 were dismissed with costs. The 2006 appeal was allowed, without costs, only to the extent of recognizing a charitable donation of $150 which was conceded by the Crown.
Whissell v. R. - TCC: Taxpayer failed to make out due diligence defence for non-filing penaltiesREAD MORE »

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