More on Fraud

In September last year, I wrote a short article about fraud and income tax. The Federal Court of Appeal reiterated the law on this subject in Vankerk v. The Queen, 2006 FCA 96. The ratio of Madame Justice Sharlow is worth quoting:

[3] All of these arguments [about acting in good faith and with due diligence] miss the point. This is not a case in which the deductibility of a loss can be saved by evidence that the appellants acted with due diligence. This is not a case of a business that suffered losses because it was ill conceived or poorly managed, and the tax authorities are second guessing the business acumen of a taxpayer. This is a case where, in fact, there was no business. There were no business expenses. There is no factual foundation for any of the deductions claimed by the appellants. These appeals will be dismissed with costs.