Citation: 2007TCC457
Date: 20070816
Docket: 2006-1741(IT)I
BETWEEN:
MARY AMMENDOLIA,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
REASONS FOR JUDGMENT
Little J.
A. Facts
[1] Between January 1,
2002 and December 31, 2003, the Appellant was employed concurrently by the following
companies or entities:
- 944219
Ontario Limited (operating as Maple Rehabilitation Centre) (“944219”)
- The
Maple Professional Centre (“Professional”)
- Dr.
Carlo Ammendolia (The Appellant’s spouse)
(“Dr. Ammendolia”)
[2] Between January 1,
2002 and December 31, 2003 the Appellant was also employed concurrently by TV
Ontario.
[3] The Appellant’s
spouse was a Chiropractor. The Appellant’s duties at
944219, Professional and Dr. Ammendolia’s clinic included office management and
administrative functions.
[4] 944219 was a Company operated by the Appellant’s spouse.
The Appellant’s spouse also operated Professional. (The above companies are
hereinafter referred to as the “Husband’s Companies”.)
[5] The Appellant received non-commission employment income
from her Husband’s Companies as follows:
2002 $32,195.00
2003 $31,693.00
[6] The Appellant’s employment
duties at TV Ontario involved hosting and producing various television programs
focused mainly on health and welfare and lifestyle issues. The Appellant hosted
the following programs:
- More to
Life
- The
Health Series
[7] The Appellant
received non-commission employment income from TV Ontario as follows:
2002 $78,086.00
2003 $90,182.00
[8] The Appellant
maintains that she was required to incur significant expenditures which were
not reimbursed by her Husband’s Companies and TV Ontario.
[9] When the Appellant
filed her income tax returns for the 2002 and
2003 taxation years she claimed the following employment expenses:
2002 $28,810.00
2003 $21,142.00
[10] The expenses claimed
by the Appellant included the following:
- motor
vehicle and other travel expenses
- supplies
- clothing,
hair/make-up
- food,
beverage, entertainment, newspapers, magazines, internet, and health club membership.
[11] The employment
contracts signed by the Appellant with TV Ontario state that the Appellant was
entitled to the following annual allowance with receipts:
2001
– 2002 – (The period from August 1, 2001 to July 31, 2002)
Professional
Expenses (Annual allowances with submissions of proper receipts)
- wardrobe
allowance of up to $2,500.00
- hair/make-up
as required.
(See
Exhibit R-1 – Tab 1)
2002
– 2003 - (The period from August 1, 2002 to July 31, 2003)
Professional
Expenses (Annual allowance with submissions of proper receipts
- wardrobe
allowance of up to $3,500.00
- hair/make-up
as required
- parking
spot allowance of $1,600.00
(See
Exhibit R-1 – Tab 2)
2003
– 2004 – (The period from August 1, 2003 to July 31, 2004)
- wardrobe
allowance of $5,000.00 for “More to Life” and $5,000.00 for “The Health Series”
- hair/make-up
as required
- parking
spot – allowance of $1,600.00)
(See
Exhibit R-1 – Tab 3)
[12] By Notices of
Reassessment dated April 11, 2006, the Minister of National Revenue (the
“Minister”) allowed the Appellant to deduct work space in the home expenses as
follows:
2002 $1,442.00
2003 $1,688.00
[13] All of the other
expenses claimed by the Appellant were disallowed by the Minister.
B. Issue
[14] The issue is whether
the Appellant is entitled to deduct any expenses in addition to the expenses
allowed by the Minister in determining her income for the 2002 and 2003
taxation years.
C. Analysis and Decision
[15] Subsection 8(1) of
the Income Tax Act (the “Act”) specifies the various deductions
that are available to a taxpayer in computing income in a taxation year from an
office or employment.
[16] Subsection 8(2) of
the Act contains a general limitation that no deductions except those
permitted in subsection 8(1) are to be made in computing a taxpayer’s income.
[17] In connection with
the expenses claimed by the Appellant related to her employment with her Husband’s
Companies, I have concluded that the Appellant is not allowed to deduct any of
these expenses because she was a non‑commission employee of these
employers. In reaching this conclusion I note that as a non‑commission
employee the Appellant is restricted to those deductions that are specified in
section 8 of the Act.
[18] With respect to the
expenses relating to a motor vehicle, travel supplies, clothing, hair/make-up,
food, beverage, entertainment, newspapers, magazines, internet and health club
membership, section 8 of the Act restricts the expenses that a non‑commission
employee may claim. Furthermore, as is noted above the Appellant was reimbursed
by TV Ontario for many of the expenses that she claimed.
[19] I also wish to note
that the Appellant decided not to testify at the hearing and the Appellant’s
spouse attempted to give evidence on behalf of the Appellant. I found that the
evidence provided by the Appellant’s spouse was inadequate and insufficient to discharge
the onus that was on the Appellant. In my opinion the Appellant has not met the
onus of establishing that the Minister’s reassessments were incorrect. From an
analysis of the evidence I have also concluded that many of the expenses
claimed by the Appellant were personal expenses that are not allowed by section
8 of the Act.
[20] The appeals are
dismissed without costs.
Signed at Vancouver, British Columbia, this 16th day of August 2007.
“L.M. Little”
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