Lovas v. The Queen, 2004 TCC 383 (Informal Procedure)

REASONS FOR JUDGMENT

(Edited from reasons delivered orally from the Bench at

Toronto, Ontario on January 6, 2004)

Woods J.

[1]      Roland Lovas appeals an income tax assessment for the 2000 taxation year in respect of the receipt of compensation received to settle a wrongful dismissal suit. Mr. Lovas received a cheque for $25,000 that, according to the minutes of settlement, was to be a net payment. The employer remitted $5,541.07 on account of income tax source deductions and other amounts on account of premiums for Canada Pension Plan and Employment Insurance.

[2]      Mr. Lovas included as gross income in his income tax return the aggregate of the $25,000 payment and the source deduction payments. Although there was no evidence as to the amount assessed by the Minister, it appears that the figure reported as gross income by Mr. Lovas was accepted by the Minister.

[3]      Mr. Lovas appealed on two grounds:

1.        He submits that the employer did not make sufficient source deductions and that the Minister should proceed against the employer for the deficiency and not Mr. Lovas.

2.        He submits that because there were insufficient source deductions made, the gross income figure in the return should be increased to take into account the amount that should have been deducted as source.

[4]      In respect to the first ground, I would conclude that I have no jurisdiction over the collection of tax owing and therefore I cannot give the relief that Mr. Lovas seeks. A remedy for this matter would have to go to a different court, perhaps the Federal Court of Canada. However, there appears to be some confusion about whether there is an amount of tax owing in respect of the wrongful dismissal claim and I suggest that Mr. Lovas deal with counsel for the Respondent and whomever he suggests at the CCRA in respect of this matter.

[5]      In respect to the second ground, I would not think it appropriate to increase the amount of gross income. This issue is not really separate from the first issue because Mr. Lovas appears to seek what he views as the correct amount of tax owing to be obtained from his former employer. As previously indicated I have no jurisdiction to provide this remedy and therefore I decline to increase the gross income, and therefore the tax owing, by Mr. Lovas.

[6]      The appeal is dismissed.

Signed at Ottawa, Canada, this 21st day of May, 2004.

J.M. Woods, J.