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Docket: 2003-544(IT)I
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BETWEEN:
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JACQUES SOUCY,
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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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[OFFICIAL
ENGLISH TRANSLATION]
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_______________________________________________________________
Appeal heard on July 9, 2003 at Sept-Îles, Québec.
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Before: The
Honourable Justice Alain Tardif
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Appearances:
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For the
Appellant:
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The Appellant
himself
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Alain Gareau
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_______________________________________________________________
JUDGMENT
The
appeal from the assessments made pursuant to the Income Tax Act for the
1999 and 2000 taxation years is dismissed in accordance with the attached
Reasons for Judgment.
Signed at Ottawa,
Canada, this 31st day of July 2003.
Tardif
J.
Translation certified
true
on this 30th day of
March 2009.
Bella
Lewkowicz, Translator
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Citation: 2003TCC513
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Date: 20030731
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Docket: 2003-544(IT)I
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BETWEEN:
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JACQUES SOUCY,
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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
Tardif J.
[1] This
is an appeal from Notices of Assessment for the 1999 and 2000 taxation years.
[2] The
issue is to determine whether the Minister of National Revenue (the Minister),
with respect to the years at issue, correctly added, when calculating the
Appellant’s income as a shareholder in the corporation “Pêcheries
J.S. inc.”, the amounts of $9,229 and $11,405, respectively, as taxable
benefits.
[3] The
assessments were made on the basis of the following assumptions of fact:
[TRANSLATION]
a) during the
years at issue, the Appellant was a shareholder in the corporation “Pêcheries
J.S. inc.”;
b) the
corporation “Pêcheries J.S. inc.” has owned a 1999 Chevrolet 4x4 Truck
that cost $44,394 since March 4, 1999;
c) the vehicle
described in the previous paragraph was made available to the Appellant from
the day it was purchased on March 4, 1999, until December 31, 2000, that is,
303 days with respect to the 1999 calendar year and 365 days with respect to
the 2000 calendar year;
d) the Appellant
did not keep a log to distinguish between the kilometres travelled for personal
purposes and those travelled for business purposes during the years at issue;
e) the Minister
calculated that the Appellant used the corporation vehicle for personal
purposes 25% of the time;
f) the taxable
benefit, for each year at issue, arises from the use of the vehicle.
[4] The
Appellant, after being sworn in, admitted to the allegations in paragraphs 3 b)
and 3 d).
[5] His
testimony essentially consisted in explaining the contents of a portion of his
Notice of Appeal with respect to the breakdown of the kilometrage. The
breakdown should be reproduced here:
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1999
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2000
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Kilometres travelled during the
year
Travel for business
Travel Baie-Trinité Factory
Travel to Iberville
Travel to Rivière-au-Renard
Travel in the winter season
Travel to Baie-Comeau
Kilometres travelled for personal
purposes
% of personal use
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10,000 km
(6,000 km)
(2,800 km)
(960 km)
___________
240 km
2.4%
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17,000 km
(6,000 km)
(2,800 km)
(4,000 km)
(1,300 km)
(1,920 km)
(920 km)
60 km
0.3%
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[6] According
to the Notice of Appeal and the testimony, the Appellant allegedly travelled
240 kilometres for personal purposes in 1999 and 60 kilometres in 2000.
[7] The
vehicle in question was a 4x4 truck, which cost $44,394 in 1999. It was a
well-equipped and comfortable vehicle, very popular in regions where the
climate is difficult and where a significant portion of the local economy
depends on commercial fishing.
[8] Although
he has already been audited, the Appellant confirmed not having kept a log to
calculate the kilometrage for personal purposes for the truck that the
corporation he controlled made available to him.
[9] He
and his spouse have three children; the Appellant confirmed primarily using his
personal minivan for family outings.
[10] The Appellant also confirmed that each time he left his home for work,
he used the company truck; he described his job as being responsible for the
boat when it was in port and at sea during fishing trips.
[11] The Appellant had the burden of proof. To discharge such a burden of
proof, it would have been necessary for him to provide reasonable and plausible
explanations. Instead, he insisted that he only travelled 240 kilometres in
1999 and 60 kilometres in 2000, which seems to me to be entirely implausible;
moreover, I have no doubt that during the long and difficult winter season, he
used this vehicle so that his family could travel safely.
[12] Other than his limited travels, the Appellant admitted to
systematically travelling from home to the home port, using the company
vehicle, and that these trips took place annually, given that the boat required
daily care and attention, even when stored during the winter season. This
constituted personal use, as the travel between his home and place of work is
essentially personal in nature. This personal kilometrage for the two taxation
years alone significantly exceeds the evaluation of 300 kilometres submitted by
the Appellant.
[13] The Appellant admitted to not having or completing a log for the
purpose of accurately tracking personal use. He also admitted that the
corporation he controlled made the vehicle in question available to him.
[14] The Appellant had the burden of demonstrating the merits of his
submissions on a preponderance of evidence. On the contrary, the preponderance
of evidence established unequivocally that the Respondent’s evaluation was
reasonable and corresponded, without a shadow of a doubt, more to reality than
the rather implausible claims of the Appellant.
[15] The evidence established that the Appellant had every right to use the
vehicle of the corporation he controlled without any restrictions and as he saw
fit.
[16] The Appellant in fact used the corporate vehicle for personal purposes
in a manner far more substantial than his own evaluation of 300 kilometres for
the two taxation years.
[17] The Appellant recognized that he did not log any data in a special log
with respect to his personal use of the corporation vehicle.
[18] Finally, I find that the evaluations and explanations submitted by the
Appellant in support of his submissions were simply unbelievable.
[19] For these reasons, the appeal is dismissed.
Signed at Ottawa,
Canada, this 31st day of July 2003.
Tardif
J.
Translation certified
true
on this 30th day of
March 2009.
Bella
Lewkowicz, Translator
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