D
E
Taylor:—This
is
an
appeal
by
Robert
W
McMillan,
chartered
accountant,
with
respect
to
the
1980
taxation
year.
I
would
note
that
by
agreement
between
the
parties,
and
specifically
at
the
request
of
the
appellant,
the
mat-
ter
has
been
heard
on
an
agreed
statement
of
facts.
That
agreed
statement
of
facts
is
understood
by
the
Board
and
by
counsel
for
the
Minister
to
be
outlined
in
a
letter
to
the
Board
from
the
appellant
dated
December
7,
1981.
Essentially,
the
taxpayer
is
claiming
that
since
he
supported
his
daughter
Magdalene
in
a
self-contained
domestic
establishment
from
January
1,
1980
to
November
19,
1980,
he
is
entitled
to
the
deduction
provided
under
paragraph
109(1)(b)
of
the
Income
Tax
Act,
SC
1970-71-72,
c
63,
as
amended.
At
the
same
time,
because
he
married
on
November
20,
1980
and
incidentally
continued
to
support
his
daughter
in
the
same
self-contained
domestic
establishment,
he
is
also
entitled
to
the
married
exemption
provided
for
under
paragraph
109(1)(a)
of
the
Act.
It
is
my
view
that
the
appellant
in
his
reading
of
those
relevant
sections
is
not
making
the
critical
distinction
between
eligibility
for
the
deduction
to
be
claimed
under
one
section
or
the
other,
and
possible
non-eligibility
due
to
the
different
marriage
status
which
occurred
at
different
periods
during
his
taxation
year.
Counsel
for
the
Minister
has
noted
the
wording
of
paragraph
109(1)(b)
and
I
read
it
for
the
record:
“Wholly
dependent
persons
—
In
the
case
of
an
individual
not
entitled
to
a
deduction
under
paragraph
(a)”,
and
then
the
section
goes
on
to
provide
essentially
the
same
dollar
deduction
as
that
provided
under
paragraph
109(1
)(a).
The
critical
and
absolutely
essential
words
are
“not
entitled
to
a
deduction
under
paragraph
(a)”.
This
taxpayer
was
clearly
entitled
to
the
deduction
under
paragraph
109(1
)(a)
as
a
result
of
his
marriage
on
November
20,
1980.
He
claimed
the
deduction
and,
as
counsel
pointed
out,
he
was
accorded
that
deduction.
Counsel
for
the
Minister
refrained
from
attempting
to
interpret
the
appellant’s
perspective
on
this,
but
the
Board
will
take
the
liberty
to
indicate
that
perhaps
the
appellant
felt
that
he
could
claim
a
deduction
under
paragraph
109(1
)(b)
(in
effect
for
the
first
portion
of
the
year
up
to
November
19,
1980)
and
then
revert
to
paragraph
109(1
)(a)
and
claim
a
deduction
for
the
period
after
November
20,
1980.
That
is
precisely
the
wrong
viewpoint
to
take
on
those
two
sections,
as
I
see
it.
Paragraph
109(1
)(b)
has
therein
the
condition
precedent
that
we
have
noted:
“not
entitled”
and
in
the
event
that
a
taxpayer
“is
entitled”
to
a
deduction
under
paragraph
109(1
)(a),
paragraph
109(1
)(b)
is
not
open
to
him
—
not
only
is
it
not
open
to
him
for
deduction,
it
is
not
even
activated
as
a
potential
deduction
section.
Simply
put,
paragraph
109(1
)(b)
follows
upon
the
review
of
a
taxpayer
to
see
whether
he
or
she
is
entitled
to
a
deduction
under
paragraph
109(1
)(a).
In
the
event
that
the
taxpayer
is
not
so
entitled,
then
paragraph
109(1
)(b)
becomes
activated
and
is
not
activated
in
any
other
manner.
I
point
out
that
such
non-eligibility
under
paragraph
109(1)(a)
does
not
provide
automatically
the
deduction
under
paragraph
109(1
)(b)
but
it
does
activate
the
potential
for
just
such
a
deduction.
There
is
no
basis
for
the
claim
of
the
appellant
as
it
is
filed
and
the
Minister’s
position
is
completely
correct.
Paragraph
109(1
)(a)
takes
precedence
over
paragraph
109(1
)(b)
precisely
as
it
is
spelled
out
in
the
Income
Tax
Act.
The
appeal
is
dismissed.
Appeal
dismissed.
Email this Content