Citation: 2008TCC189
Date: 20080414
Docket: 2007-3826(IT)I
BETWEEN:
RICHARD BEAUCHAMP,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
[OFFICIAL ENGLISH
TRANSLATION]
REASONS FOR JUDGMENT
Bédard J.
[1]
The Minister of
National Revenue ("the Minister") disallowed the Appellant's
claim of a tax credit for severe and prolonged physical impairment in respect
of his 2003, 2004 and 2005 taxation years. The Appellant is appealing from
this decision.
[2]
The issues are as
follows:
(a)
Is the Appellant
entitled to bring an appeal before this Court in respect of the 2003 and 2004
taxation years?
(b)
In computing his
non-refundable income tax credits for the 2005 taxation year, is the Appellant
entitled to the credit for severe and prolonged mental or physical impairment?
[3]
I will immediately note
that, to the extent that it applies to the 2003 and 2004 taxation years, the
Notice of Appeal cannot be entertained because no notice of objection was
served on the Minister in accordance with section 165 and 169 of the Income Tax
Act ("the Act") with respect to those taxation years. In
fact, no right of appeal ever came into existence because the Appellant never
served a notice of objection on the Minister with regard to the assessments
made for those years.
[4]
The Appellant was the
only person who testified in support of his appeal. His testimony
discloses the following:
(a)
He has been suffering
from severe sleep apnea since 1995, a condition that causes him to stop
breathing for short periods during his sleep. The Appellant explained that
these "respiratory events" are followed by a reaction whereby he
wakes up and resumes breathing. The Appellant added that this resulted in
fragmented sleep and daytime sleepiness.
(b)
In order to remedy his
condition — that is to say, in order to be able to
sleep — he has been using a device known as a
CPAP (continuous positive airway pressure) device since 1995. It consists of a
mask attached by a tube to an oxygen tank. The Appellant explained that
the use of the mask exerts positive pressure on the breathing passages and
keeps them open, which normally suppresses the respiratory events and generally
eliminates daytime sleepiness. The Appellant added that he must also take
a sedative in order to facilitate sleep. He also explained that he has been
using the CPAP device every night since 1995 for an average of eight hours, and
that he occasionally uses it during the daytime when he takes a nap. Lastly,
the Appellant explained that he cannot sleep without a CPAP device.
(c)
Because of his health
problems, he had to take 84 days off work in 1999, 19 days in 2000,
26.5 days in 2001, 42.5 days in 2002, and 208 days in 2003.
(d)
The Appellant had to
quit his job in 2004 because of his numerous health problems. He added that
the Régie des rentes du Québec and his employer have considered him disabled since
January 2004.
[5]
The evidence further
discloses as follows:
(a)
In October 2006, upon
filing a request for an adjustment with a view to obtaining a tax credit, the
Appellant sent the Minister a Form T2201 (Exhibit A-1) "Disability Tax
Credit Certificate", which was filled out by Dr. Baltzan, a qualified
person, who diagnosed his patient with sleep apnea syndrome.
(b)
On May 2, 2007, the
Minister forwarded the form T2201 to the programs section responsible for the
Disability Tax Credit.
(c)
In a questionnaire
dated May 7, 2007 (Exhibit I‑1), which he appears to have filled out
on the same day, Dr. Baltzan noted that the reason for using the CPAP device is
to reduce neurological drowsiness, not to provide a solution to an underlying
diagnosis that would indicate that the treatment is essential to sustaining a
vital function. In the same questionnaire, Dr. Baltzan clearly stated that
the Appellant can live without using a CPAP device. However, in a letter dated
February 27, 2008, Dr. Baltzan made the following statement with
respect to the Appellant's health: "I feel that this is essential medical
care for this particular patient because he is exposed to excessive risk of
falling asleep in daytime, destabilization of his hypertension and potential
stroke, heart attack and death, should he not use his CPAP for severe sleep
apnea." It should be added that, in his letter dated June 27, 2008, Dr. Baltzan did not specify whether the comments
quoted above applied to the 2005 taxation year. I would immediately point out
that the stance taken by Dr. Baltzan (who, it should be noted, did not testify
in support of the Appellant's position) as to whether the use of the CPAP
device was essential to sustain life, is ambiguous at best.
The Appellant's position
[6]
At the hearing, the
appellant essentially reiterated the position that he stated in his Notice of
Appeal, which reads:
[TRANSLATION]
I have been under supervised treatment since July 1995 and,
according to the specialists that I have met, the only truly effective
treatment to combat the effects of this illness is the use of a CPAP (a pump that
delivers air through the nose during sleep at a pressure of 17 cm H2O, out of a possible maximum of 18 cm).
This treatment is essential to sustain my vital functions, namely, my
breathing. I use this treatment every day, 365 days a year, for an average of
eight hours per day.
. . .
Consequently, I meet all the criteria set out in section 118.3 of
the Income Tax Act and a use therapy that is essential to sustain a
vital condition, namely my breathing. This treatment is administered more than
three times a week and requires me to spend more than 14 hours a week apart
from my normal everyday activities.
Analysis and determination
[7]
The relevant provisions
of the Act read as follows:
118.3(1) Where
(a) an individual has one or more severe and
prolonged impairments in physical or mental functions,
. . .
(a.1) the effects of the impairment or impairments are such
that the individual’s ability to perform more than one basic activity of daily
living is significantly restricted where the cumulative effect of those
restrictions is equivalent to having a marked restriction in the ability to
perform a basic activity of daily living or are such that the individual’s
ability to perform a basic activity of daily living is markedly restricted or
would be markedly restricted but for therapy that
(i)
is essential to sustain a vital function of the
individual,
(ii)
is required to be administered at least three
times each week for a total duration averaging not less than 14 hours a week,
and
(iii)
cannot reasonably be expected to be of
significant benefit to persons who are not so impaired,
. . .
(1.1) Time spent on therapy – For the
purpose of paragraph 118.3(1)(a.1), in determining whether therapy
is required to be administered at least three times each week for a total
duration averaging not less than an average of 14 hours a week, the time spent
on administering therapy
(a) includes only time spent on activities that require the
individual to take time away from normal everyday activities in order to
receive the therapy;
. . .
118.4(1) Nature of impairment -- For the
purposes of subsection 6(16), sections 118.2 and 118.3 and this subsection,
. . .
(b) an individual's ability to perform a basic activity of
daily living is markedly restricted only where all or substantially all of the
time, even with therapy and the use of appropriate devices and medication, the
individual is blind or is unable (or requires an inordinate amount of
time) to perform a basic activity of daily living;
. . .
[8]
The effect of paragraph
118.3(1)(a.1) of the Act is to make the tax credit for mental or
physical impairment available to people whose ability to perform a basic
activity of daily living would be markedly restricted but for the therapy that
they are receiving at least three times a day for a total duration averaging
not less than 14 hours a week for the purpose of maintaining a vital
function. The provision makes the tax credit available to persons who, but for
the therapy to which they must devote a substantial amount of their time, would
have impairments that would markedly restrict their ability to perform a basic
activity of daily living. Subsection 118.3(1.1) of the Act specifies the
activities that are included in the time devoted to receiving therapy for the
purposes of paragraph 118.3(1)(a.1) of the Act. To this end, the
paragraph specifies that the time spent on administering therapy is calculated
on the basis, inter alia, that it includes only time spent on activities
that require the individual to take time away from normal everyday activities
in order to receive the therapy. In themselves, the provisions concerning the
time spent on therapy essential to sustaining a vital function do not cause a
person to be eligible if the person is receiving therapy in a way that does not
interrupt the person's everyday activities.
[9]
In my opinion, the
Appellant's use of the CPAP device did not require him to interrupt his
everyday activities in any way. Indeed, I do not see what everyday activity
could have been interrupted by wearing a mask at night in the case at bar. Thus,
the Appellant did not receive vital function sustaining therapy for the amount
of time required by the Act, that is to say, at least three times a week for a
total duration averaging not less than 14 hours a week. Consequently, the
Appellant was not eligible for the tax credit for severe and prolonged mental
or physical impairment for the years concerned. In other words, the Appellant
was not eligible for this tax credit because, among other reasons, he did not
devote a substantial amount of his time to receiving therapy to sustain his
vital functions.
[10]
I would add that the
use of a CPAP device is not to be considered "therapy" for the
purposes of paragraph 118.3(1)(a.1) of the Act. In this regard, Paris J.
held as follows in Girard:
In any case, it cannot be said that the
use of the CPAP device represented therapy essential to sustain a vital
function. It also seems that the use of the CPAP device would not be considered
therapeutic care. The Canadian Oxford Dictionary defines the word
"care" as being, inter alia, a "process of looking
after or providing for someone or something." If Parliament had wanted to
include therapeutic devices in paragraph 118.3(1)(a.1) of the Act, it
would have specifically mentioned them as it did in subsection 118.4(1) which
refers to ". . . therapy and the use of appropriate devices
and medication . . ."
[11]
Lastly, it is my
opinion that the Appellant is not entitled to this tax credit because he did
not prove that the wearing of the mask, assuming it can be considered
"therapy", was essential to sustaining a vital function. In
this regard, the Appellant would have had to prove that, in 2001, his life
would have been in immediate or proximate danger if he had not used the CPAP. There
was no such proof in the case at bar.
[12]
For all these reasons,
the appeal is dismissed.
Signed at Ottawa, Canada, this
14th day of April 2008.
"Paul Bédard"
Translation
certified true
on this 9th day of
May 2008.
Brian McCordick,
Translator
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