Docket: 2007-2708(GST)I
BETWEEN:
LUC VOINSON,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
[OFFICIAL ENGLISH TRANSLATION]
____________________________________________________________________
Appeal heard
on November 1, 2007, at Montréal,
Quebec.
Before: The Honourable
Justice Alain Tardif
Appearances:
|
For the Appellant:
|
The Appellant himself
|
|
Counsel for the Respondent:
|
Brigitte Landry
|
____________________________________________________________________
JUDGMENT
The appeal from the assessment made under
Part IX of the Excise Tax Act for the period from
August 1, 2004, to December 31, 2005, notice of which is
dated November 15, 2006, and bears the number DE‑3944, is
dismissed in accordance with the attached Reasons for Judgment.
Signed at Ottawa, Canada, this 5th day of
December 2007.
"Alain Tardif"
Translation
certified true
on this 9th day of
January 2008.
Brian McCordick,
Translator
Citation: 2007TCC710
Date: 20071205
Docket: 2007-2708(GST)I
BETWEEN:
LUC VOINSON,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
[OFFICIAL ENGLISH
TRANSLATION]
REASONS FOR JUDGMENT
Tardif J.
[1] This is an appeal
from an assessment made on November 15, 2006, under Part IX of
the Excise Tax Act ("the ETA"), for the period from August 1, 2004, to December 31, 2005, and bearing the number
DE-3944.
[2] The facts on which
the Minister of National Revenue ("the Minister") relied in
making the assessment are set out in paragraph 18 of the Reply to the Notice of
Appeal:
[TRANSLATION]
(a) The facts
admitted to above.
(b) The Appellant
was, during the period in issue, a non-registrant for the purposes of Part IX
of the Excise Tax Act, R.S.C. 1985, c. E‑15 (hereinafter
"ETA").
(c) As alleged in
the Notice of Appeal, the Appellant carried on a renovation and maintenance
business during the period in issue.
(d) As alleged in
the Notice of Appeal, the Appellant's gross income was $17,110 in 2003 and
$44,861 in 2004.
(e) The Respondent
took the position that the Appellant's gross income for 2003 was $17,110, or $4,277.50 per
quarter.
(f) The Respondent
took the position that the Appellant's gross income for 2004 was $44,861, or
$11,215.25 per quarter.
(g) The Respondent
took the position that, as of August 1, 2004, the Appellant was no longer a small supplier because the total supplies
for the four quarters preceding the quarter commencing July 1, 2004, exceeded
$30,000.
(h) Thus, effective
August 1, 2004, all supplies made by the Appellant in the course of
the commercial activities of his business during the period in issue
constituted taxable supplies for which a 7% tax on the value of the
consideration for the supply was payable by the Appellant's recipients, and the
Appellant had to collect this tax and remit it to the Respondent's representatives.
(i) The Respondent
determined that the Appellant could be a "specified registrant"
because he met the prescribed conditions.
(j) The Respondent
applied the Quick Method of accounting to determine the Appellant's net tax for
the period in issue.
[3] The issue is
formulated by the Respondent as follows:
Thus, the issue is whether the Appellant
ceased to be a small supplier on August 1, 2004, and failed to collect and remit the GST on the supplies made during the
period in issue.
[4] The Appellant, a
very likeable individual, explained that he had to go through an extremely
difficult period. He had numerous health problems to contend with. Highly educated,
he chose to earn a living through his talents as a carpenter rather than
counting on his university education.
[5] After a turbulent
period with several causes, the Appellant wisely decided to clear up the
management of his affairs. Thus, he took the initiative to report his business
income for the 2003 and 2004 taxation years. This was followed by an assessment
based on the numbers that the Appellant reported.
[6] The Appellant
explained that a part of the income that he reported for 2004 should
undoubtedly have been reported in the previous year, 2003, when the
reported income was $17,110; the reported income for 2004 was $44,861, for a
two‑year total of $61,971, which represents an annual average slightly
higher than $30,000, the threshold at which a taxpayer is required to register.
In such a situation, the Appellant clearly would have escaped the
assessment. He would like his appeal to result in a kind of retroactive
amendment of his tax return in order to avoid the assessment.
[7] The assessment in
the case at bar was based on the assumptions that would be most advantageous to
the Appellant in terms of principal, interest and penalties, and this was due,
no doubt, to the somewhat special characteristics of the file and the
Appellant's likeable nature. In other words, the assessment was based on the
assumptions most favourable to the Appellant.
[8] However, the
assessment was made in accordance with the provisions of the ETA, including
sections 123, 148, 165, 221, 225, 228, 240, 296 and 299.
[9] The arguments based
on ignorance, incapacity related to medical problems, or other causes that
elicit great sympathy for the Appellant, are not relevant and should not be
taken into consideration in determining the merits of the assessment.
[10] Unfortunately, these
are elements that cannot be taken into account, notably for reasons of fairness
to all other Canadian taxpayers.
[11] When a person
decides to earn his living by operating a business, or, as in the case at bar,
through self-employment, that person must comply with all the laws and
regulations that apply to his activity.
[12] When a person is
incapable of complying, whether for medical reasons or out of ignorance, he
must simply mandate someone else to do this for him.
[13] In the case at bar,
the Appellant, being self-employed, should have known that if his sales
exceeded a certain threshold, he had to register and thereby become an agent
for the collection of the taxes imposed by the legislator.
[14] Even though the
Appellant claims to have had reasons for neglecting to fulfil his tax
obligations and those reasons elicit sympathy, and even though all this was
brought to light through his own initiative, this has no effect on the merits
of the assessment.
[15] Indeed, the
assessment is perfectly in keeping with the provisions of the ETA. Moreover, it was based
on figures that the Appellant himself provided.
[16] For these reasons, I
must dismiss the appeal and confirm the assessment on its merits, since the
Appellant ceased to be a small supplier as of August 1, 2004, and
failed to collect and remit the GST on the supplies that were made.
Signed at Ottawa, Canada, this 5th day
of December 2007.
"Alain Tardif"
Translation certified true
on this 9th day of January 2008.
Brian McCordick, Translator
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