Taylor,
T.C.J.:—
This
is
an
appeal
heard
in
Vancouver,
British
Columbia,
on
July
13,
1987,
against
an
income
tax
assessment
in
which
the
Minister
of
National
Revenue
had
taxed
an
amount
of
$2,270
as
applicable
to
the
taxation
year
1985,
whereas
the
taxpayer
contended
the
amount
should
be
taxed
in
the
year
1986.
An
agreed
statement
of
facts
was
presented,
but
the
"exhibits'*
referenced
therein
have
not
been
reproduced
below:
1.
The
Appellant
is
an
employee
of
Her
Majesty
in
right
of
Canada
working
as
a
lawyer
at
the
office
of
the
Department
of
Justice
in
Vancouver.
2.
On
November
25,
1985,
by
a
memorandum
attached
as
Exhibit
1,
the
Appellant
requested
an
advance
of
employment
in
income
for
the
period
from
January
7
to
January
25,
1986,
when
he
would
be
on
vacation
and
at
a
conference.
3.
His
request
was
forwarded
to
the
Pay
and
Benefits
Section
of
the
Department
of
Justice
under
cover
of
Exhibit
2,
a
memorandum
dated
November
27,
1985.
4.
By
letter
dated
December
10,
1985,
and
included
as
Exhibit
3,
the
Pay
and
Benefits
Section
forwarded
a
cheque
in
the
amount
of
$2,270,
the
statement
of
earnings
from
which
is
attached
as
Exhibit
4.
5.
The
vacation
advance
of
$2,270
was
an
estimate
of
the
usual
net
pay
of
the
Appellant
over
the
two
pay
periods
which
commenced
on
December
30,
1985,
and
ended
January
24,
1986.
6.
The
Statement
of
Earnings
which
is
attached
as
Exhibit
5
shows
that
for
the
pay
period
ending
January
10,
1986,
all
usual
deductions
were
taken
and
$1,153.05
of
the
vacation
advance
was
recovered.
7.
The
Statement
of
Earnings
which
is
attached
as
Exhibit
6
shows
that
for
the
pay
period
ending
January
24,
1986,
all
usual
deductions
were
taken
and
the
outstanding
vacation
advance
of
$1,116.95
was
recovered.
8.
The
$2,270
vacation
advance
received
by
the
Appellant
in
1985
was
included
in
his
1985
T4
Statement
of
Remuneration
Paid
provided
by
the
Department
of
Supply
and
Services
and
attached
as
Exhibit
7.
It
was
the
assertion
of
the
taxpayer
that
that
the
amount
could
be
regarded
as
a
"loan",
since
no
deductions
were
made
from
the
gross
amount
in
1985
but
such
deductions
were
made
retroactively
in
pay
periods
which
followed
in
1986.
In
Mr.
Randall’s
view
he
would
have
been
required
to
repay
the
amount
even
in
the
event
he
had
ceased
the
employment
at
the
end
of
1985
and
been
unable
to
perform
the
services
required
of
him
in
1986.
The
Minister’s
contention
was
that
the
amount
was
caught
by
the
provisions
of
section
3
and
5
of
the
Act
—
as
“salary,
wages,
or
other
remuneration
.
.
.
received
by
him
in
the
year”.
The
"source"
to
which
the
Minister
attributed
the
amount
was
the
taxpayer's
employment.
Certain
jurisprudence
was
cited
and
commented
on
by
the
parties,
but
there
was
general
agreement
that
there
was
nothing
specific
on
the
point,
although
some
of
the
case
law
was
instructive
and
enlightening.
In
my
view
the
proposition
of
the
appellant
that
this
should
be
considered
a
"loan"
is
not
viable.
Mr.
Randall
did
not
request
a
"loan"
from
his
employer,
he
did
request
"pay
in
advance"
and
the
evidence
indicates
that
was
what
he
received.
There
is
nothing
about
“making
deductions"
from
an
amount
(or
not
doing
so)
that
gives
that
amount
unquestionably
the
quality
of
salary
or
wages.
Further
if
he
were
sued
for
"non-performance",
as
he
noted
might
happen,
I
am
not
persuaded
even
the
recovery
of
the
amount
in
a
subsequent
year
by
his
employer,
would
have
any
direct
bearing
on
its
taxability
in
1985.
In
the
end
analysis
the
amount
is
"pay"
and
therefore
salary
or
wages,
as
indicated
by
subsection
5(1)
of
the
Act.
The
appeal
is
dismissed.
Appeal
dismissed.
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