Lachance v. Agence du revenu du Québec, 2025 QCCA 1476

The taxpayer was assessed pursuant to s. 24.0.1 of the Quebec Tax Administration Act (similar to ETA s. 323(1)) over three years following the assessment of the corporation of which he was a director in respect of the unremitted QST at issue. The taxpayer argued, based on the reference in s. 24.0.1 to various procedural rules of the Taxation Act, including the three-year statute barring rule, applying “with the necessary modifications”, that the assessment of him pursuant to s. 24.0.1 was accordingly statute-barred.

In rejecting this submission, the Court stated (at paras. 38-41, TaxInterpretations translation):

[T]his interpretation unduly limits the scope and purpose of the regime established by section 24.0.1 of the TAA, which is to "prevent the misappropriation of taxes and source deductions by corporate directors". Indeed, the imposition of liability under section 24.0.1 of the TAA remains contingent upon the occurrence of the scenarios provided for therein, which may arise well after the issuance of the initial assessment against the corporation that remains unpaid. In fact, it is the attempt at enforcement, the bankruptcy, or the liquidation of the Corporation that serves as the triggering event and gives rise to the ARQ's authority to assess the director; it is not the original assessment issued against the Corporation. Once again, the regime under section 24.0.1 of the TAA adheres to its own conditions and is independent of the regime applicable to the Corporation.

The only temporal limitation on the initial assessment issued against the director is that of the second paragraph of section 24.0.2 of the TAA, namely "the expiry of two years from the date on which that director last ceased to be a director of the corporation."

Furthermore, the interpretation adopted by the trial judge aligns with the approach taken by certain federal courts, particularly with respect to section 323 of the Excise Tax Act [later quoting Jarrold] … .

Contrary to the appellant's argument … the application of the presumption of coherence between tax laws that contain substantially the same regime and do not present fundamental differences, as in this case, can be very useful in deriving the interpretation of an analogous tax provision.

Although s. 24.0.1 of the Quebec Tax Administration Act was similar to ETA's s. 323 and ITA s. 227.1, the taxpayer argued that some wording differences were sufficient to establish that the assessment of him under s. 24.0.1, as the director of a corporation that had failed to remit QST, was statute-barred because such personal assessment was made more than three years after the assessment of the corporation for the QST.

In rejecting this submission, the Court referred (at para. 41, TaxInterpretations translation) to “the presumption of coherence between tax laws that contain substantially the same regime and do not present fundamental differences” – and then referred to the finding in Jarrold that the only limitation period in ETA s. 323 is the two-year period in s. 323(5) running from when the individual ceased to be a director.