Hill v. The Queen, docket 1999-2302-IT-I (Informal Procedure)

Date: 20010618

Docket: 1999-2302-IT-I

BETWEEN:

DANIEL B. HILL,

Appellant,

and

HER MAJESTY THE QUEEN,

Respondent.

Reasons for Judgment

(Delivered orally from the Bench at Kelowna, British Columbia on October 3, 2000)

Beaubier, J.T.C.C.

[1]            This appeal, pursuant to the Informal Procedure, was heard at Kelowna, British Columbia on October 2, 2000. The Appellant was the only witness.

[2]            Paragraphs 5 to 8 inclusive of the Reply to the Notice of Appeal read:

5.              In computing his tax payable for the 1995 taxation year, the Appellant claimed a deduction of $6,308.62 for an overseas employment tax credit ("OETC").

6.              By Notice of Reassessment dated June 19, 1997, the Minister reassessed the Appellant's income tax return for the 1995 taxation year and disallowed the said deduction for an OETC referred to in paragraph 5 above.

7.              In so reassessing the Appellant's income tax return for the 1995 taxation year, the Minister made the following assumptions of fact:

a)              during the 1995 taxation year the Appellant was employed by Major Drilling Group International Inc. (Employer #1) on a project in Peru and earned total remuneration of $26,215.00;

b)             during the 1995 taxation year, the Appellant was also employed by Falcon Drilling Ltd. (Employer #2) on a project in Panama and earned total remuneration of $15,608.56;

c)              the periods of employment that the Appellant worked for Employer           #1 can be summarized as follows:

§                      February 17 - March 21, 1995;

§                      June 9 - July 30, 1995;

§                      August 29 - September 17, 1995.

d)             the Appellant worked for Employer #2 from April 5, 1995 until May 17, 1995;

e)              both Employer #1 and Employer #2 were "specified employers" within the meaning of subsection 122.3(2) of the Income Tax Act. (the Act);

f)              during the period from February 17 to September 17, 1995, the Appellant was working for a total of 144 days and not working for a total of 65 days;

g)             the Appellant worked under four different contracts during the periods of employment as indicated in subparagraphs 7(c) and 7(d);

h)             the Appellant was not paid vacation leave by Employer #1 during any of the 65 day period in which he was not working;

i)               the breaks in the period of employment were due to lack of work;

j)               the four time frames that the Appellant was working as indicated in subparagraphs 7(c) and 7(d) constitute four distinct and separate employment periods;

k)              the Appellant was not employed outside Canada for a period of more than six consecutive months commencing before the end of the 1995 taxation year within the meaning of subsection 122.3(1) of the Act; and

l)               the Appellant is not entitled to a deduction in computing tax payable in regard to the 1995 taxation year with respect of employment outside Canada pursuant to section 122.3 of the Act.

B.             ISSUES TO BE DECIDED

8.              The issue is whether the Appellant was entitled to a deduction from tax payable, in respect of an OETC for the 1995 taxation year.

Assumption 7(a), (b), (c), (d), (e), (f), and (h) were not refuted.

[3]            The evidence is that the Appellant was laid off on March 21, 1995. Thereafter he testified that his times off work were "holidays", which represented a practice in the industry. Crown Counsel disputed this and, particularly, the period from May 17, 1995 to June 9, 1995 when the Appellant changed employers.

[4]            However, even if the Court were to find that the May 17 to June 9 period was a holiday, the total consecutive time employed, including "holidays", from April 5 to September 17, 1995 is not 6 months which is the period required under the Income Tax Act.

[5]            The Appellant further argues that he was advised by Revenue Canada staff that he had qualified and, before that, how to qualify. But the advice of Revenue Canada staff cannot change the Income Tax Act.

[6]            Because the Appellant was not employed (including "holidays") abroad for a period of 6 consecutive months, the appeal is dismissed.

Signed at Calgary, Alberta this 18th day of June 2001.

"D.W. Beaubier"

J.T.C.C.

COURT FILE NO.:                                                 1999-2302(IT)I

STYLE OF CAUSE:                                               Daniel B. Hill and The Queen

PLACE OF HEARING:                                         Kelowna, British Columbia

DATE OF HEARING:                                           October 2, 2000

REASONS FOR JUDGMENT BY:      The Honourable Judge D.W. Beaubier

DATE OF JUDGMENT:                                       October 3, 2000

APPEARANCES:

For the Appellant:                                                 The Appellant himself

Counsel for the Respondent:              Victor Caux

COUNSEL OF RECORD:

For the Appellant:                

Name:                     

Firm:                       

For the Respondent:                             Morris Rosenberg

                                                                                Deputy Attorney General of Canada

                                                                                                Ottawa, Canada