In Kumar v R, 2024 TCC 105 (informal procedure), the Court found that the CRA had properly reassessed the appellant to include in his income payments to him and his son made by a corporation to which the appellant had loaned money. The appellant had loaned money to the corporation, and a unpaid balance remained on the loans, but the payments were not debited to the loan account. The Court found that subsection 15(1) applied to the payments to the appellant and subsection 56(2) applied to the payments to the son so that they were properly included in the appellant’s income.
The Court found that gross negligence penalties were not applicable to the amounts included in the appellant’s income, however, on the basis that he had thought he was properly receiving repayments of his loan.
