If a court take too long to hear a taxpayer’s case, is the taxpayer entitled to interest relief under the fairness provisions of the Income Tax Act? In Cole v. Canada (Attorney General), 2005 FC 1445, the CRA said no. The Federal Court took another view of the matter.
Settling Tax Court Appeals
It is often said that, in a tax appeal, the Canada Revenue Agency is the client and the Department of Justice is its lawyer. As the client, the CRA gives instructions to Justice about how to conduct a tax case. Whether a case can be settled, it is thought, depends on the litigation officer from the CRA who is giving instructions to Justice. Indeed, Justice lawyers themselves often talk this way.
Garber v. The Queen, 2005 TCC 635, suggests that the situation is more complex than that.
OMA Law
Some readers of this newsletter were under the impression that my last article (“OMA Opens Law Firm!”) was intended to applaud the Ontario Medical Association (OMA) for offering to incorporate professional corporations for its members. In fact, our firm has…
OMA Opens Law Firm!
Apparently, the Ontario Medical Association has opened a law firm. It is offering to incorporate professional corporations for doctors for a “nominal” fee ($100 plus disbursements plus GST for a total of $523.90). It is unclear how long this sale will last, so doctors should hurry to take advantage of it before it is too late.
Section 84.1
What tax practitioner hasn’t woken up in the middle of the night, sweating, because of dreams haunted by section 84.1 file demons? I will try to banish the demons — or propitiate them anyway — in a short presentation on February 2, 2006 at the CRA’s Hamilton & District Tax Consultation Group.
Fairness: First and Second Reviews
A taxpayer submits a fairness request to the CRA, and the request is rejected by the first officer to review it on the ground that it did not show inability to pay. The taxpayer agrees with the officer: the taxpayer did fail to show inability to pay because the taxpayer never raised the issue! The taxpayer, however, did mention CRA delay as a ground for relief, but that point is not addressed by the officer. The taxpayer sends the request back to the CRA for another review. A recent case — Dort (Estate) v. Canada (Minister of National Revenue), 2005 FC 1201 —- suggests that this other review should be regarded as a “first look” by the CRA and that, if the CRA rejects the request, the taxpayer is entitled to a second review.
RRSP Mischief
Here’s a depressing case to start off the New Year and take us into the “RRSP season”: Nunn v. The Queen, 2005 TCC 806. The CRA warning about similar schemes, discussed here and here, was apt but too late for…
Medical/Dental PC Regulation Released
Yesterday, Ontario published the regulation that prescribes who can own shares of professional corporations (PCs) controlled by doctors and dentists — see Ontario Regulation 665/05 under the Business Corporations Act (Ontario).
Cautionary Tale
Rajah v. The Queen, 2005 TCC 637 is not a case that breaks new ground, legally, but it serves as a useful reminder — expressed with the usual clarity and concision that one finds in Mr Justice Bonner’s decisions — that (1) the key question in any dispute about an assessment of tax is whether it is too high; (2) the taxpayer bears the onus of proving that the assessment is too high; and (3) the taxpayer cannot rely on information (supposedly) obtained from the CRA, especially if it is obtained from a nameless agent contacted through the CRA’s 800 number.
Update on Medical/Dental PCs
Bill 197, “An Act to Implement Budget Measures”, received Royal Assent last Monday. As a result, after 2005 the Lieutenant Governor in Council can make regulations that will permit the family members of doctors and dentists to hold shares of…