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Citation: 2003TCC920
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Date: 20031229
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Docket: 2003-898(IT)I
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BETWEEN:
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LAWRENCE BORYSOWICH,
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Appellant,
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and
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HER MAJESTY THE QUEEN,
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Respondent.
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REASONS FOR JUDGMENT
O'Connor, J.
[1] The issue in this appeal is how to
determine the amount of Good and Services Tax Credit
("GSTC") to which the Appellant is entitled for the
2001 taxation year.
[2] The Appellant's entitlement to
the GSTC for the 2001 taxation year was initially determined by
the Minister of National Revenue (the "Minister"), GSTC
Notice thereof dated July 5, 2002, in the amount of $538.00,
payable in four (4) equal quarterly instalments, on the
basis, as reported by the Appellant, that the Appellant's
marital status was "married" for the 2001 taxation
year, and he lived with his daughter, Laura, born April 1987, at
the end of the 2001 taxation year.
[3] The Amended Reply to the Notice of
Appeal reads in part as follows:
4. In so
determining the Appellant's entitlement to the GSTC for the
2001 taxation year, the Minister made the following assumptions
of fact:
(a) at the time the
Appellant's initial entitlement to the GSTC for the 2001
taxation year was determined by the Minister, the initital
determination was based on the fact that the Appellant lived with
his daughter, Laura, born April 1987, and on the information
provided by the Appellant that his marital status was
"married", as reported by him on his 2001 taxation year
income tax return;
(b) the Appellant
and his spouse ("Fay Borysowich") lived in the same
self-contained domestic establishment throughout the 2001
taxation year;
(c) and (d) deleted
(e) the Appellant
and Fay Borysowich are the parents of (4) children, Laura, born
April 1987, Brian, born 1984, Nicholas, born 1998 and Alexandra
also born 1998;
(f) Fay
Borysowich advised the CCRA, by correspondence dated
June 4, 2001, that Brian was missing, and she did not
specify the actual date that this circumstance had occurred;
(g) Fay Borysowich
also advised the CCRA, by way of a completed questionnaire
returned to the CCRA in November 2001, that Nicholas and
Alexandra had been abducted;
(h) as neither the
Appellant nor Fay Borysowich advised the CCRA of the date of the
abduction, it was presumed to be within 6 months prior to
the date Fay Borysowich notified the CCRA that the children went
missing;
(i) Brian,
Nicholas and Alexandra did not live with the Appellant and Fay
Borysowich at the end of the 2001 taxation year; and
(j) Laura,
born April 1987, lived with the Appellant and Fay Borysowich
at the end of the 2001 taxation year.
Additional Fact
5. Brian,
Nicholas and Alexandra did not return to the Appellant's
residence in 2002 or 2003.
B. Issues to be decided
6. The issues
are:
(a) whether the
Minister has properly determined the Appellant's entitlement
to the GSTC in respect of the 2001 taxation year; and
(b) whether the Appellant
had 4 (four) "qualified dependants", as defined in
subsection 122.5(1) of the Income Tax Act R.S.C. 1985 (5th
supp.) c.1, (the "Act") for the 2001 taxation
year.
C. Statutory provisions, grounds relied on and relief
sought
7. He relies
on sections 3, 122.5, 122.6, and subsection 248(1) of the
"Act", as amended for the 2001 taxation
year.
8. He submits
that the Minister has properly determined the Appellant's
GSTC, in accordance with subsection 122.5(3) of the
Act.
9. He also
submits that the Appellant, who was an "eligible
individual" as defined in subsection 122.5(1) of the
Act, had only one (1) "qualified dependant",
Laura, as defined in subsection 122.5(1) of the Act.
[4] As one can see from the Amended
Reply to the Notice of Appeal, the Minister has taken the
position that the Appellant is only entitled to the GSTC in
respect of Laura as she was the only one who resided with the
Appellant at the end of the 2001 taxation year.
Analysis
[5] In my opinion the evidence does
not contradict the statements and assumptions in the Amended
Reply quoted above.
[6] The Appellant states that
notwithstanding the abduction of Nicholas and Alexandra, who are
twins, they still should be considered as qualifying as residing
with the Appellant. The abduction was not the fault of the
Appellant nor his wife and no evidence was submitted as to where
Nicholas and Alexandra (the abductees) lived but it is clear that
they did not live with the Appellant and the Appellant's
wife.
[7] As a consequence of the
introduction of the Goods and Services Tax, the former refundable
federal sales tax credit was replaced by the GST credit. As with
the sales tax credit, the GST tax credit is intended to alleviate
the burden of the GST on lower income taxpayers. Although the GST
did not come into effect until January 1, 1991, the GST credit
applies to the 1989 and subsequent taxation years. Credits in
respect of the 1989 taxation year were payable in December 1990
and April 1991. Credits in respect of 1990 and subsequent
taxation years are payable in July and October of the immediately
following year and in January and April of the second immediately
following year.
[8] The GST credit is novel in its
form of payment. The credit is calculated on the basis of tax
payable for a year and then paid in quarterly instalments over
the succeeding year commencing in July. For example, if a
taxpayer has a GST credit calculated in respect of the 2001
income tax return, the taxpayer cannot use the credit to reduce
2001 taxes, but rather must accept payment of one-fourth of
the credit in July and October 2002 and January and April 2003.
That is the way the Minister acted in this case.
[9] Although the most relevant
provisions of the Act, namely sections 122.5 and 122.6
have changed from time to time, what remains constant is that the
person entitled to the GSTC is referred to as the "eligible
individual" and the person in respect of whom the credit can
be claimed is defined as the "qualified dependant".
Both definitions specify that the qualified dependant, usually a
child, must reside with the eligible individual in Canada.
[10] In the present appeal the only
qualified dependant that resided with the Appellant was Laura and
consequently the determination of the Minister was correct.
[11] Consequently the appeal is
dismissed.
Signed at Ottawa, Ontario, this 29th day of December 2003.
O'Connor, J.
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