|
Docket: 2004-1711(IT)I |
|
BETWEEN: |
|
PERRY D. CHARLEBOIS, |
|
Appellant, |
|
and |
|
|
|
HER MAJESTY THE QUEEN, |
|
Respondent. |
____________________________________________________________________
Appeal heard on October 6, 2004, at Toronto, Ontario,
|
By: The Honourable Justice A.A. Sarchuk |
|
|
|
|
|
Appearances: |
|
|
|
|
|
For the Appellant: |
The Appellant himself |
|
|
|
|
Agent for the Respondent: |
Paolo Torchetti (Student-at-law) |
____________________________________________________________________
JUDGMENT
The appeal from the assessment of tax made under the Income Tax Act for the 2001 taxation year is dismissed.
Signed at Ottawa, Canada, this 30th day of November, 2004.
|
"A.A. Sarchuk" |
Sarchuk J.
|
Citation: 2004TCC785 |
|
Date: 20041130 |
|
Docket: 2004-1711(IT)I |
|
BETWEEN: |
|
PERRY D. CHARLEBOIS, |
|
Appellant, |
|
and |
|
|
|
HER MAJESTY THE QUEEN, |
|
Respondent. |
REASONS FOR JUDGMENT
Sarchuk J.
[1] In computing tax payable for the 2001 taxation year, the Appellant claimed a gross non-refundable tax credit in relation to an "amount for an eligible dependent" totalling $6,293 in respect of his daughter, Nadine. The Appellant was initially assessed, as filed. Subsequently, the Minister of National Revenue reassessed the Appellant and disallowed the "amount for an eligible dependent" as the Appellant failed to provide sufficient information to demonstrate that he was entitled to such a claim.
[2] The following facts are not in dispute. The Appellant and Tracey Brandt are the parents of two children, Courtney, born May 1, 1989 and Nadine, born May 31, 1996. The Appellant and Tracey were living separate and apart due to a marriage breakdown during the 2001 taxation year. The Appellant testified that the marriage had been "on the rocks" for some period of time and that as a result, even though they continued to reside in the same residence in 2001, they maintained separate bedrooms and led separate lives. Both were employed and for the most part worked "opposite shifts" which enabled one of them to look after the children with the result that day-care for them was required only on rare occasions. The Appellant also testified that he and Tracey shared all of the expenses in the home, albeit he paid the majority of them. He says that he had received information from Revenue Canada to the effect that if he and Tracey were unable to agree on "who is going to claim the children, that the claim would be denied to both of us" and as a result "we decided that at the very beginning that I would claim both children and then we continued to do so throughout the years until the 2001 year where things started getting really messy, so we decided to claim one each". Thus, in filing their returns in that year, the Appellant claimed Nadine and Tracey claimed the other daughter, Courtney.[1]
[3] The Respondent's position is premised in part on the provisions of paragraph 118(1)(b) of the Income Tax Act, the relevant portion of which reads:
118(1) For the purpose of computing the tax payable under this Part by an individual for a taxation year, there may be deducted ...
(b) in the case of an individual who does not claim a deduction for the year because of paragraph (a) and who, at any time in the year,
(i) is
(A) ...
(B) a person who is married or in a common-law partnership, who neither supported nor lived with their spouse or common-law partner and who is not supported by that spouse or common-law partner, and
(ii) whether alone or jointly with one or more other persons, maintains a self-contained domestic establishment (in which the individual lives) and actually supports in that establishment a person who, at that time, is
(A) ...
(B) wholly dependent for support on the individual, or the individual and the other person or persons, as the case may be,
(C) related to the individual, and
(D) ...
Counsel for the Respondent argued that although the Appellant had separated from his wife, at the same time he claims that he supported the wife entirely and that he was the primary income earner in the family. That, counsel argued, defeats the Appellant's reliance on this provision since the legislation clearly stated that one is required not to have supported the other spouse.
[4] Paragraph 118(1)(a) provides for what is known as the married tax credit which may be claimed only by an individual who is married and supports the spouse. Paragraph 118(1)(b) provides a somewhat similar credit for taxpayers who support a wholly dependent person. The Act is clear that the equivalent to married tax credit cannot be claimed by an individual who is married and lives with his spouse, but can be claimed only by an individual who is single, widowed, divorced or separated. In order to claim this credit, the taxpayer must have supported an individual living in their home who was wholly dependent upon the taxpayer. In this particular appeal, it is clear that the child in issue was not wholly dependent upon the taxpayer. If the Appellant and his wife were living separate and apart, and the Minister does not dispute that fact, there is nonetheless inadequate information as to which of the parents cared for which child. This information is relevant and the best that could be said with respect to the evidence before the Court is that both the Appellant and his estranged spouse were involved in the financial support required. Counsel for the Respondent further argued that the Appellant cannot succeed because paragraph 118(4)(b) of the Act provides that:
118(4) For the purposes of subsection (1), the following rules apply:
(a) ...
(b) not more than one individual is entitled to a deduction under subsection (1) because of paragraph (b) of the description of B in subsection (1) for a taxation year in respect of the same person or the same domestic establishment and where two or more individuals otherwise entitled to such a deduction fail to agree as to the individual by whom the deduction may be made, no such deduction for the year shall be allowed to either or any of them;
(c) ...
These legislative provisions indicate that not more than one individual is entitled to the deduction in question for a taxation year in respect of either the same person or the same domestic establishment. Where two or more individuals otherwise entitled to such a deduction fail to agree as to whom a deduction can be taken, no such deduction for the year shall be allowed to either or any of them.
[5] The Appellant has conceded that he that he and his wife each had made a claim for a deduction with respect to one of the children. I agree with the Respondent's position that this takes the Appellant out of the provisions of the Act and accordingly the Minister's assessment was correct in that no dependents were wholly dependent and/or supported by the Appellant in a self-contained domestic establishment that he himself maintained.
[6] Accordingly, the appeal is dismissed.
Signed at Ottawa, Canada, this 30th day of November, 2004.
|
"A.A. Sarchuk" |
Sarchuk J.
|
CITATION: |
2004TCC785 |
|
COURT FILE NO.: |
2004-1711(IT)I |
|
STYLE OF CAUSE: |
Perry D. Charlebois and Her Majesty the Queen |
|
PLACE OF HEARING: |
Toronto, Ontario |
|
DATE OF HEARING: |
October 6, 2004 |
|
REASONS FOR JUDGMENT BY: |
The Honourable Justice A.A. Sarchuk |
|
DATE OF JUDGMENT: |
November 30, 2004 |
|
APPEARANCES: |
|
For the Appellant: |
The Appellant himself |
|
Agent for the Respondent: |
Paolo Torchetti (Student-at-law) |
|
COUNSEL OF RECORD: |
|
For the Appellant: |
|
Name: |
N/A |
|
Firm: |
N/A |
|
For the Respondent: |
Morris Rosenberg Deputy Attorney General of Canada Ottawa, Canada |