Sarchuk J.T.C.C.:-This 1s the appeal of Mr. John Fischer with respect to assessments of tax for the 1991 and 1992 taxation years. Mr. Fischer has elected the informal procedure pursuant to the provisions of subsection 18(1) of the Tax Court of Canada Act.
In computing his income for the 1991 taxation year, the appellant did not include pension benefits in the amount of $6,294 from the United Brotherhood of Carpenters and Joiners of America. I will refer to this entity as the union. For the 1992 taxation year, the appellant deducted an amount of $6,216.50 in respect of an equivalent amount of pension benefits received from the union and included in his income.
The Minister of National Revenue, in his assessment, included the pension benefits of $6,294 in the appellant’s income in 1991 and disallowed the deduction of $6,216.50 claimed in 1992.
The appellant takes the position that his pension is paid out of or under a foreign arrangement established under the laws of the United States, and that if he were a resident in that country would not be subject to income tax there. Therefore he says the pension benefits in issue need not be included in income because of the exception found in clause 56(l)(a)(i)(C.l) of the Income Tax Act, R.S.C. 1985 (5th Supp.), c. 1 (the "Act"). This provision, added by 1991, c. 49, subsection 32(1), is applicable with respect to payments received after July 30, 1990. It reads:
32(1) Without restricting the generality of section 3, there shall be included in computing the income of a taxpayer for a taxation year,
(a) any amount received by the taxpayer in the year as, on account or in lieu of payment of, or in satisfaction of,
(C.l) the amount of any payment out of or under a foreign retirement arrangement established under the laws of a country, except to the extent that the amount would not, if the taxpayer were resident in the country, be subject to income taxation in the country.
The factual basis for the appellant’s position is somewhat imprecise and uncertain. What evidence he was able to produce can be summarized as follows. For a number of years the appellant was an employee of the union. As an employee he was a member of the union’s benefit plan. Between 1969 and 1983 he contributed a total of $27,074 to this plan. According to the appellant, membership in the plan was compulsory. Each month the required amount was deducted from his salary at source and was, as far as he knew, forwarded to the union in the United States. He maintains that he did not know, and was never advised by the union, that these contributions might have been deductible in the computation of his income in accordance with the Canadian Income Tax Act. He emphasized that at no time did he deduct these amounts and contends that, in result, the contributions required by the union were paid by him in tax paid dollars.
The appellant produced a document captioned "local unions and coun- cils pension plan”, which sets out the highlights of the plan and, in particular, he refers to a paragraph on the first page which reads:
The pension plan is administered by a board of trustees made up of seven persons. Their names appear in this booklet. This board of trustees governs the pension fund in accordance with an agreement and declaration of trust. Contributions are made by affiliates as a percentage of pay, as required by the constitution and laws.
Mr. Fischer also produced what he believes to be a relevant portion of the union’s constitution and laws. In particular, he drew the Court’s attention to section 65. This section provides in part, and I quote:
There shall be established and maintained by the United Brotherhood a pension plan for such officers and representatives of all subordinate bodies as may be eligible, including such other employees of the subordinate bodies as may be necessary to maintain qualification of the plan as a tax exempt trust within the meaning of the U.S. Internal Revenue Code, which shall be known as "United Brotherhood of Carpenters and Joiners of America Local Unions and Councils Pension Plan”.
Mr. Fischer says that these documents establish that the plan was a foreign retirement arrangement within the meaning of clause 56(l)(a)(i)(C.l) of the Act.
In addition to his reliance on 56(l)(a)(i)(C.l), he maintains that an assessment of tax on the amount of benefits included in his income is tantamount to double taxation and violates the equality of rights guaranteed by section 15 of the Canadian Charter of Rights and Freedoms.
Several other relevant facts were brought out by counsel for the respondent in cross-examination. In each of the years 1984 to 1990, the appellant received pension benefits of $6,294. In 1983 the amount received was $2,470. These amounts were not included in his income for tax purposes in those years.
Second, although he professed to be unaware that the union’s pension plan had been registered in Canada since 1991, (I am not certain of the date, my notes indicate 1991, but I am not certain that that is the date mentioned in Court) he was aware that his contributions were forwarded to the U.S. and then routed to a trust company in Toronto, Ontario. I believe it was the International Trust Company. That is what is shown on the Minister’s reply. This trust company, on the face of it, appears to have administered the Canadian portion of it and made all pension payments to him.
The Minister’s position in all of this is that the pension benefits received by the appellant from the union in 1991 were properly included in computing his income in that year, in accordance with paragraph 56(1 )(a) of the Act.
The Minister also takes the position that the Act does not provide for a deduction in computing taxable income, in respect of the pension benefits the appellant received from the union in 1992 and that, accordingly, those pension benefits are to be included in his taxable income.
In order to succeed in an appeal from an assessment, a taxpayer is required to demonstrate, on a balance of probabilities, that the assessment is wrong in law or is based on incorrect facts. Mr. Fischer has raised an interesting argument, but in my view has failed or has simply been unable to marshal sufficient evidence to support his position strongly enough to tip the scales in his favour.
To succeed with the 56(l)(a)(i)(C. 1) argument, he must establish that the union’s pension plan was a foreign retirement arrangement. That, in my view, has not been done. A foreign retirement arrangement is defined by Regulation 6803 of the Income Tax Act as, and I quote:
For the purposes of the definition of "foreign retirement arrangement" in subsection 248(1) of the Act, a prescribed plan or arrangement is a plan or arrangement to which subsection 408(a), (b) or (h) of the United States Internal Revenue Code of 1986, as amended from time to time, applies.
The appellant has not produced any evidence that the union pension plan is one to which those sections of the American Internal Revenue Code apply. I appreciate the difficulties inherent in so doing, but without such evidence his position is rather tenuous and inadequate.
To demonstrate just generally the shortcomings of the evidence before me, let me set out some questions which the evidence has raised and has created doubts regarding the appellant’s position. If this plan was established under the laws of the U.S. as argued by the appellant, one has to ask the question: What is the effect of the registration of all or part of this plan in Canada as a registered pension plan? Is the plan, as it applies to the appellant, no longer subject to the Internal Revenue Code, but is now governed by the tax laws of Canada? I do not know the answer, but without some evidence establishing this plan as a plan described in the definition, I am left in the dark. This and other concerns have not been addressed. The result is that I cannot with any confidence reach a conclusion that the appellant has, on a balance of probabilities, demonstrated that the pension income in issue is tax exempt.
Furthermore, in my view the issue of double taxation and the alleged violation of section 15 of the Charter is not well founded. The facts do not support an argument that the Minister of National Revenue is engaged in taxing the taxpayer twice on the amounts in issue. In fact, there is some evidence before me that in all years that the appellant made contributions to the union plan, and that he could have deducted the amounts in the calculation of his income. That he was not aware of the relevant provisions, and his union failed to properly advise him does not assist him. To put it plainly, the failure to take advantage of available legislative provisions will not and should not provide a basis for a submission that the appellant 1s entitled to what amounts to equitable relief, because that failure or that lack of knowledge may have resulted in payment of tax twice on the same
amount, if that is indeed what happened.
Since the taxpayer has raised the issue of fairness and Charter protection of his rights, I do not think it would be appropriate to conclude without noting that, as the Income Tax Act read in the years 1983 to 1990, he was required to include the benefit payments in the computation of his income for tax purposes. Prior to 1991 that was not done and the Minister has not moved to reassess for those years. I add only that this fact plays no role in my determination regarding the provisions of clause 56(l)(a)(i)(C. 1 ) of the Act.
On balance, I find that the evidence produced to the Court lacked the quality and weight necessary to establish the position advanced by the taxpayer. The appeal is accordingly dismissed.
Appeal dismissed.
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