Docket: 2012-3135(IT)I
BETWEEN:
JEAN-PIERRE EVANGÉLIST,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
[OFFICIAL ENGLISH
TRANSLATION]
____________________________________________________________________
Appeal
heard on February 12, 2013, at Sherbrooke, Quebec.
Before: The Honourable
Justice Lucie Lamarre
Appearances:
|
For the appellant:
|
The appellant himself
|
|
Counsel for the respondent:
|
Emmanuel Jilwan
|
____________________________________________________________________
JUDGMENT
The appeal from the reassessment made pursuant
to the Income Tax Act for the 2010 taxation year is dismissed, but the
appellant may claim his moving expenses, as amended, as of the 2012 taxation
year.
Signed at Ottawa, Canada, this 20th day
of February 2013.
"Lucie Lamarre"
Translation certified true
on this 28th day of March 2013.
Elizabeth Tan,
Translator
Citation: 2013 TCC 62
Date: 20130220
Docket: 2012-3135(IT)I
BETWEEN:
JEAN-PIERRE EVANGÉLIST,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
[OFFICIAL ENGLISH
TRANSLATION]
REASONS FOR JUDGMENT
Lamarre J.
[1]
The appellant is
appealing from a reassessment made pursuant to the Income Tax Act (ITA) for
the 2010 taxation year in which the Minister of National Revenue (Minister)
disallowed the $8,695.43 deduction claimed for moving expenses.
[2]
The appellant moved
from Montréal to Rivière-du-Loup in early January 2009 for a new job with Premier
Tech, as senior director of administrative services. The company advised the
appellant at the end of April 2010 that it had to terminate his employment.
[3]
While he immediately began
looking for a new job, the appellant kept working for Premier Tech for a few
months. An agreement was signed on May 26, 2010, under which Premier Tech agreed
to pay all relocation and transportation expenses to his point of origin, if
necessary.
[4]
The May 26, 2010,
agreement was amended with a new agreement signed on August 20, 2010, such that
instead of paying moving expenses, Premier Tech agreed to pay an additional
salary of $5,000 over five weeks.
[5]
The appellant made several
attempts to find work and resorted to moving his property at the end of 2010,
storing it at a friend's place in Sherbrooke. This was when he incurred the moving
expenses he claimed. He admits that the claim represents two $650 expenses and
conceded that part of the mileage claimed was to find work in Montreal. He is
therefore willing to reduce the claim by half the kilometres (he was claiming
1,000 kilometres and is now asking 500 kilometres for the move) and deduct the
$650 claimed twice by mistake.
[6]
Despite all his
efforts, he only found permanent work in October 2012. He was hired by the City
of Sherbrooke as assistant auditor general.
[7]
The respondent
disallowed the moving expenses claimed based on section 62 and the definition
of "eligible relocation" at subsection 248(1) if the ITA.
[8]
Subsection 62(1) and
the definition of "eligible relocation" at subsection 248(1) of the
ITA state:
Income Tax Act
62.
(1) Moving expenses — There
may be deducted in computing a taxpayer’s income for a taxation year amounts
paid by the taxpayer as or on account of moving expenses incurred in respect of
an eligible relocation, to the extent that
(a) they were
not paid on the taxpayer’s behalf in respect of, in the course of or because
of, the taxpayer’s office or employment;
(b) they were
not deductible because of this section in computing the taxpayer’s income for
the preceding taxation year;
(c) the total
of those amounts does not exceed
(i) in any case described in subparagraph (a)(i) of the definition “eligible relocation” in
subsection 248(1), the total of all amounts, each of which is an amount
included in computing the taxpayer’s income for the taxation year from the
taxpayer’s employment at a new work location or from carrying on the business
at the new work location, or because of subparagraph 56(1)(r)(v) in respect of the
taxpayer’s employment at the new work location, and
...
Part xvii—Interpretation
248(1)
Definitions — In this Act,
"eligible
relocation" means a relocation of a taxpayer
where
(a) the
relocation occurs to enable the taxpayer
(i) to carry on a business or to be employed
at a location in Canada (in section 62 and this subsection referred to as “the
new work location”), or
...
[9]
It is clear upon
reading subparagraph 62(1)(c)(i) that the appellant cannot claim his
moving expenses for the 2010 taxation year, since he cannot deduct an amount
greater than the amount of the income he earned from his job at the new work
location.
[10]
In 2010, the appellant
had no income from a new job. However, in 2012, after much effort, he managed
to find a job from which he earned income. In 2013, he was still at this job.
[11]
In my opinion, and as
suggested by counsel for the respondent, the definition of "eligible relocation"
is sufficiently broad to allow the appellant to consider that the moving
expenses incurred in 2010 constituted expenses incurred for an eligible
relocation.
[12]
There is no indication
that the new job must be held in the year the expenses are incurred. The
relocation must be done in order to allow the taxpayer to operate a business or
hold a job in a location in Canada called the new work location.
[13]
Moreover, section 62 does
not require the moving expenses to be incurred during the year in which the taxpayer
wishes to deduct them. If the new job is found within a reasonable time after
the move, the taxpayer may deduct the moving expenses as of the year he begins
earning income from the new job (see Roald K. Abrahamsen v. The Queen,
2007 TCC 95).
[14]
In this case, the
appellant began receiving income from his new job in 2012 and it was in 2012
that he could begin to deduct his moving expenses.
[15]
The amount the
appellant submitted in his 2010 tax return was $8,695.43. This amount must be
reduced by $650, which was claimed twice.
[16]
These expenses also
included an amount for mileage driven. The appellant attributed $0.565 per
kilometre for 1,000 kilometres. The parties agree that only 500 kilometres will
be attributed to the eligible relocation.
[17]
For these reasons, the appeal
from the reassessment made for the 2010 taxation year is dismissed, but the
appellant may claim moving expenses, as amended, as of the 2012 taxation year.
Signed at Ottawa,
Canada, this 20th day of February 2013.
"Lucie Lamarre"
Translation
certified true
on this 28th day
of March 2013.
Elizabeth Tan,
Translator
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