Date: 20010704
Docket: 2001-544-IT-I
BETWEEN:
RICK BADGER,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
Reasons for Judgment
Beaubier, J.T.C.C.
[1]
This appeal pursuant to the Informal Procedure was heard at
Calgary, Alberta on June 21, 2001. The Appellant testified. The
Respondent called the Appellant's former wife Sonia
Badger.
[2]
Paragraphs 3 to 8 inclusive of the Reply to the Notice of Appeal
read:
3.
In computing his income tax liability for the 1998 taxation year,
the Appellant claimed:
(a) a
personal credit for a wholly dependant person (the
"Credit") in respect of his daughter, Meagan Jane
Badger, (the "daughter") in the amount of $5,380.00,
17% of which is the actual non-refundable tax credit for the
year; and
(b) a
personal credit for the supplementary amount in the amount of
$204.00, 17% of which is the actual non-refundable tax credit for
the year.
4.
The original notice of assessment for the 1998 taxation year was
dated and mailed to the Appellant on May 20, 1999.
5.
In reassessing the Appellant for the 1998 taxation year on March
6, 2000, the Minister of National Revenue (the
"Minister"):
(a)
disallowed the claim for the Credit for his daughter; and
(b)
disallowed the claim for the supplementary amount.
6.
In so reassessing the Appellant, the Minister made the following
assumptions of fact:
(a)
the facts admitted and stated above, some of which are repeated
here for ease of reference;
(b)
the net income of the Appellant for the 1998 taxation year was
$28,703.00;
(c)
the net income of the daughter for the 1998 taxation year was
nil;
(d)
the Appellant and the former spouse are the parents of the
daughter;
(e)
at all material times, the Appellant and the former spouse both
share joint custody of their daughter;
(f)
at all material times, the Appellant and the former spouse shared
in the parenting of their daughter;
(g)
during the 1998 taxation year, the daughter resided with both the
Appellant and the former spouse;
(h)
the daughter was wholly dependent upon the Appellant for support
during the time periods in the 1998 taxation year when she
resided with the Appellant;
(i)
the daughter was wholly dependent upon the former spouse for
support during the time periods in the 1998 taxation year when
she resided with the former spouse;
(j)
during the 1998 taxation year, the Appellant and the former
spouse each maintained separate self-contained domestic
establishments in which they lived and supported their
daughter;
(k)
the Appellant and the former spouse both claimed the Credit in
respect of their daughter for the 1998 taxation year; and
(l)
the Appellant and his former spouse are unable to agree with
respect to whom may claim the Credit for their daughter.
B.
ISSUES TO BE DECIDED
7.
The issues to be decided are:
(a)
whether the Appellant is entitled to the Credit in respect of his
daughter in the amount of $5,380.00 for the 1998 taxation year;
and
(b)
whether the Appellant is entitled to a personal credit for the
supplementary amount in the amount of $204.00 for the 1998
taxation year.
C.
STATUTORY PROVISIONS, GROUNDS RELIED
ON AND RELIEF SOUGHT
8.
He relies on, inter alia, subsection 118(4) and paragraphs
118(1)(b) and 118(1)(b.1) of the Income Tax Act (the
"Act") as amended for the 1998 taxation
year.
[3]
Meagan is now 14. Her parents divorced in 1990 and joint custody
was ordered. She lived with Sonia until January 1, 1996. Then at
Sonia's request, due to Sonia's financial and emotional
problems, Meagan moved in with her father, Rick, and she has
lived with him since then. Every other weekend she visited Sonia
at her home where she stays overnight. In 1998 these visits did
not occur for six weeks because Meagan had a sprained ankle.
[4]
In 1998 both Rick and Sonia claimed the "equivalent to
spouse" personal tax credit which is in dispute in this
case.
[5]
In 1998, Rick did not claim the married amount, he was not
married, Rick and Meagan were living in a self contained domestic
establishment and Rick was supporting Meagan there.
[6]
The question then is whether she was wholly dependant on
Rick.
[7]
On January 8, 1996, when Meagan moved in with Rick, Sonia and
Rick drew up and signed Exhibit R-1. At that time Sonia gave up
$500.00 per month child support which Rick was paying to her for
Meagan's support. Exhibit R-1 reads:
This agreement made the 8th day of January, 1996
is an addendum to the Separation/Divorce Agreements
between
BRIAN RICHARD BADGER and SONIA JANE BADGER
In reference to the sections outlining Custody Arrangements
and Maintenance Fees, the following changes are agreed to by the
two parties as pertinent to their daughter, MEAGAN JANE
BADGER:
for the period 1 Jan. - 30 Jun. '96, Meagan's primary
residence has been agreed to be that of Rick Badger's, with
alternating weekend and liberal weekday visitations available to
Sonia Badger
after summer vacation '96, a shared parenting regime will
be scheduled whereby Meagan shall reside within each parental
residence on an equally shared time basis, with whichever parent
assuming responsibility for all Meagan's day to day
requirements as she dwells with them.
there will no longer be an exchange of Maintenance funds, as
per the outline above, but, as the higher income earner, Rick
will be responsible for clothing, school and extra curricular
activity expenses (each parent will be responsible for any
vacation expenses while in their particular care).
both parties agree that Sonia Badger will claim Meagan as her
dependant and shall, therefore, be entitled to receive the Child
Tax Credit renumeration.
both parties shall maintain effective and open communication
regarding Meagan's needs, or any subjects of
interest/necessity affecting their parenting roles.
This agreement remains binding unless a dully [sic] signed
modification is produced by the respective parties.
The parties have executed this Agreement as of the day, month
and year first written above.
"Sonia
Badger"
"Rick Badger"
Sonia Jane
Badger
Brian Richard (Rick) Badger
[8]
The Agreement does not refer to anything but the Child Tax
Credit. Specifically, it does not describe the
"spousal" credit. Sonia takes the words of the
Agreement as including the spousal credit. Rick states that they
do not, rather they argued about it back and forth each year
until 1998. It was not agreed upon by Exhibit R-1, nor did Sonia
and Rick agree on it. To the Court, the question falls within
paragraph 118(1)(b), its meaning and the facts in this
case.
[9]
Rick's testimony, which is not refuted, and is accepted, is
that he makes all of the decisions respecting Meagan's
upbringing and supports her. Sonia pays for her board at
Sonia's and Meagan overnights at Sonia's when she visits
Sonia on alternate weekends.
[10] Thus,
Sonia does not "support" Meagan when Meagan visits with
Sonia. Rather Sonia paid for Meagan's food and any
incidentals during each weekend visit every other week whether in
1998 or in other years after 1995. The word "support"
respecting children is not limited to money (or to food or to
shelter every other weekend). "Support" is defined by
the Shorter Oxford Dictionary as:
"To furnish food or maintenance for; to supply with the
necessities of life ... to keep up the strength of ... to sustain
... to keep ... from failing or giving way; to give courage,
confidence or power of endurance to ... to preserve from failure
..."
That is "support" for a family member within the
meaning of paragraph 118(1)(b) No doubt that can be shared
by a child's parents, and is shared where they are living
together. Similarly, it is the kind of "support" each
gives to another spouse. But it does not occur on mere bi-weekly
visits.
[11] That
support is what Rick was giving to Meagan in 1998. Sonia was not
giving that to Meagan in 1998.
[12] The
Appeal is allowed. Rick is awarded $100.00 on account of
out-of-pocket disbursements which he incurred
respecting this Appeal.
Signed at Ottawa, Canada this 4th day of July, 2001.
"D.W. Beaubier"
J.T.C.C.
COURT FILE
NO.:
2001-544(IT)I
STYLE OF
CAUSE:
Rick Badger v. Her Majesty The Queen
PLACE OF
HEARING:
Calgary, Alberta
DATE OF
HEARING:
June 21, 2001
REASONS FOR JUDGMENT BY: The
Honourable Judge D.W. Beaubier
DATE OF
JUDGMENT:
July 4, 2001
APPEARANCES:
For the
Appellant:
The Appellant himself
Counsel for the
Respondent:
Michael Taylor
COUNSEL OF RECORD:
For the
Appellant:
Name:
Firm:
For the
Respondent:
Morris Rosenberg
Deputy Attorney General of Canada
Ottawa, Canada
2001-544(IT)I
BETWEEN:
RICK BADGER,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
Appeal heard on June 21, 2001 at Calgary,
Alberta by
the Honourable Judge D.W. Beaubier
Appearances
For the
Appellant:
The Appellant himself
Counsel for the
Respondent:
Michael Taylor
JUDGMENT
The
appeal from the reassessment made under the Income Tax Act
for the 1998 taxation year is allowed and the reassessment is
referred back to the Minister of National Revenue for
reconsideration and reassessment in accordance with the attached
Reasons for Judgment.
The Appellant is awarded the sum of $100.00 on account of
out-of-pocket disbursements which he incurred respecting this
Appeal.
Signed at Ottawa, Canada this 4th day of July,
2001.
J.T.C.C.
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