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Date: 20030513 |
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Docket: 2002-4674(IT)I |
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BETWEEN: |
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WILLIAM PATRICK HORNELL, |
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Appellant, |
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and |
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HER MAJESTY THE QUEEN, |
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Respondent. |
_______________________________________________________________
Appeal heard on May 1, 2003 at Kamloops, British Columbia
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Before: The Honourable Judge D. W. Beaubier |
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Appearances: |
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For the Appellant: |
The Appellant himself |
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Counsel for the Respondent: |
Michael Taylor |
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JUDGMENT
The appeal from the assessment made under the Income Tax Act for the 2001 taxation year is allowed and the matter is referred back to the Minister of National Revenue for reconsideration and reassessment in accordance with the attached Reasons for Judgment.
Signed at Saskatoon, Saskatchewan, this 13th day of May 2003.
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"D. W. Beaubier" |
J.T.C.C.
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Citation: 2003TCC330 |
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Date: 20030513 |
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Docket: 2002-4674(IT)I |
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BETWEEN: |
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WILLIAM PATRICK HORNELL, |
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Appellant, |
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and |
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HER MAJESTY THE QUEEN, |
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Respondent. |
REASONS FOR JUDGMENT
Beaubier, J.T.C.C.
[1] This appeal pursuant to the Informal Procedure was heard at Kamloops, British Columbia on May 1, 2003. The Appellant testified and called Todd Harding, a Programme Officer employed by Human Resources Development Canada at all material times.
[2] Paragraphs 5 to 12 inclusive of the Reply to the Notice of Appeal read:
5. In computing income for the 2001 taxation year the Appellant deducted medical expenses in the amount of $54,886.04 and tuition fees in the amount of $12,257.94.
6. The Minister of National Revenue (the "Minister") initially assessed the Appellant for the 2001 taxation year on June 10, 2002 and allowed medical expenses of $27,418.15 and tuition fees in the amount of $10,995.00.
7 In so assessing the Appellant for the 2001 taxation year, the Minister relied on the following assumptions of fact:
a) the facts admitted above;
b) the Appellant paid a total of $1,262.00 (the "Education Amounts") to Prometric for examination fees;
c) Prometric is located in the United States;
d) Prometric is not a university and does not provide courses leading to a degree;
e) the Appellant was not enrolled in full-time attendance at Prometric;
f) the Appellant incurred expenses totalling $27,467.89 (the "Medical Amounts") for the purchase of software and web based training;
g) the Medical Amounts were not paid in respect of a medical expense as described in subsection 118.2(2) of the Income Tax Act (the "Act");
h) the Medical Amounts were not paid in respect of any equipment or device prescribed by section 5700 of the Income Tax Regulations (the "Regulations"); and
i) the Medical Amounts were not paid as tuition fees to educational institutions in Canada that are universities providing courses leading to a degree.
B. ISSUE TO BE DECIDED
8. The issue is whether the Appellant is entitled to deduct the Education Amounts and the Medical Amounts in the 2001 taxation year.
C. STATUTORY PROVISIONS RELIED ON
9. He relies on sections 118.2, 118.5 and 118.6 and subsection 248(1) of the Act, as amended for the 2001 taxation year and on section 5700 of the Regulations, as amended.
D. GROUNDS RELIED ON AND RELIEF SOUGHT
10. He submits that the Appellant is not entitled to deduct the Education Amounts since they were paid to an institution located outside of Canada that was not a university providing courses leading to a degree as required by section 118.5 of the Act.
11. He submits that the Medical Amounts are not deductible as medical expenses in the 2001 taxation year pursuant to any of the provisions of section 118.2 of the Act or section 5700 of the Regulations.
12. He submits further that the Appellant is not entitled to deduct the Medical Amounts as tuition fees are (sic) they were paid to institutions outside of Canada that were not universities providing courses leading to a degree.
He requests that the appeal be dismissed.
[3] Assumptions 7(a) to (e) inclusive were proved to be correct. As a result paragraph 10 is correct and the appeal is dismissed respecting the $1,262 education amounts.
[4] At the conclusion of the Hearing, the Respondent admitted to the Appeal respecting the following amounts:
a) Atiga $ 205.00
b) Duxbury $ 612.25
c) Snowburger $ 147.25
and the appeal is allowed respecting these sums.
[5] This then leaves the Appellant's medical expense claims respecting medical amounts, which the Court finds are not deductible as "tuition fees" for the reasons set out in paragraph 12 of the Reply to the Notice of Appeal. These constitute two categories: software items and study materials. To be claimable, they must fall within Section 118.2 of the Income Tax Act (the "Act").
[6] Paragraphs 118.2(2)(m) reads
(2) For the purposes of subsection (1), a medical expense of an individual is an amount paid ....
(m) [prescribed devices] - for any device or equipment for use by the patient that
(i) is of a prescribed kind,
(ii) is prescribed by a medical practitioner,
(iii) is not described in any other paragraph of this subsection, and
(iv) meets such conditions as may be prescribed as to its use or the reason for its acquisition,
to the extent that the amount so paid does not exceed the amount, if any, prescribed in respect of the device or equipment;
...
The applicable portions of Regulation 5700 read:
5700. For the purposes of paragraph 118.2(2)(m) of the Act, a device or equipment is prescribed if it is a ....
(l) optical scanner or similar device designed to be used by a blind individual to enable him to read print;
...
(o) device or equipment, including a synthetic speech system, braille printer and large print-on-screen device, designed exclusively to be used by a blind individual in the operation of a computer;
[7] None of the items remaining in question were "prescribed" or designed "exclusively" to be used by a blind individual in the operation of a computer. Moreover, the software material could more properly be described as a study aid. None of the items remaining in question were necessary for the Appellant's training on courses. Rather, they were extras that a person who had money would buy, but that were not necessary.
[8] In the course of the Hearing, the Appellant raised the possibility that the assessments in appeal discriminated against him on account of his blindness. They did not. Rather, Canada Customs and Revenue Agency ("CCRA") treated him as they treat all other Canadians, blind or not.
[9] Therefore, the appeal is allowed only in respect to the items described in paragraph [4].
Signed at Saskatoon, Saskatchewan, this 13th day of May 2003.
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"D. W. Beaubier" |
J.T.C.C.
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CITATION NO: |
2003TCC330 |
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COURT FILE NO.: |
2002-4674(IT)I |
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STYLE OF CAUSE: |
William Patrick Hornell v. The Queen |
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PLACE OF HEARING |
Kamloops, British Columbia |
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DATE OF HEARING |
May 1, 2003 |
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REASONS FOR JUDGMENT BY: |
The Honourable Judge D. W. Beaubier |
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DATE OF JUDGMENT |
May 13, 2003 |
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APPEARANCES: |
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For the Appellant: |
The Appellant himself |
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Counsel for the Respondent: |
Michael Taylor |
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COUNSEL OF RECORD: |
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For the Appellant: |
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Name: |
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Firm: |
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For the Respondent: |
Morris Rosenberg Deputy Attorney General of Canada Ottawa, Canada |