Ford - Federal Court of Appeal confirms that a reassessment cannot be vacated if that would increase the taxpayer’s substantive tax liability

In Anonby, the taxpayer, who had not received a T4, inferred from the $29,000 received by him in the year that his gross pay had been $42,000 with source deductions of $13,000. His return was filed and assessed on that basis, but CRA later determined that there had been no source deductions and reassessed on the basis that his gross pay was $29,000. Although his substantive tax liability thus was reduced, he still owed tax because there were no source deduction credits.

Anonby was unsuccessful in getting an order vacating the reassessment and leaving the original assessment (on $42,000) in place on the basis that the employer had deducted but failed to remit the source deductions A year later in the Court of Appeal in another case, Webb JA referred to Anonby for the proposition that "if ... the result of vacating a reassessment would be that a person’s tax liability would be increased (because the previous assessment was for a greater amount), the Tax Court ... could not grant that remedy in any event."

Neal Armstrong.  Summary of Ford v. The Queen, 2014 FCA 257 under s. 165(3).