Taylor,
J.T.C.C.:-This
is
an
appeal
under
the
informal
procedure,
heard
in
Toronto,
Ontario
on
October
31,
1994,
against
an
income
tax
assessment
for
the
year
1990,
in
which
the
respondent
denied
the
claim
for
a
deduction
of
an
amount
of
$7,500
contributed
toward
a
Registered
Retirement
Savings
Plan
(RRSP)
—
an
amount
of
$3,500
was
allowed
to
the
appellant.
The
notice
of
appeal
contained
the
following
statement:
My
layoff
in
January
1991
terminated
all
company
benefits
(health,
pension
eligibility,
etc.)
with
only
two
weeks’
notice,
and
occurred
well
in
advance
of
issue
of
the
T-4
statement
for
1990.
For
the
respondent
the
assumptions
were:
—
during
the
1990
taxation
year,
the
appellant
was
employed
by
Chemetics
International
Company
(the
"corporation");
-
during
1990
the
appellant
was
a
member
of
the
corporation
pension
plan
under
which
he
is
or
may
be
entitled
to
benefits;
—
the
appellant’s
RRSP
deduction
limit
for
the
1990
taxation
year
was
20
per
cent
of
earned
income,
up
to
a
maximum
of
$3,500.
The
respondent
submitted
that:
...the
appellant
is
not
entitled
to
deduct
RRSP
contributions
from
the
income
in
the
1990
taxation
year
in
excess
of
$3,500
in
accordance
with
provisions
of
paragraph
146(5)(a)
of
the
Act.
Mr.
Corse
explained
the
circumstances
of
his
employment,
and
agreed
that
the
effective
date
of
his
termination
was
February
14,
1991.
He
had
purchased
the
RRSP
at
issue
on
December
31,
1990,
and
it
was
in
the
amount
of
$7,500.
There
was
no
explanation
provided
for
the
purchase
of
$7,500
on
that
date
in
1990,
when
he
was
clearly
still
employed,
and
as
far
as
the
evidence
showed
would
remain
entitled
to
benefits
under
the
company
plan
(leaving
aside
for
the
moment
the
two
year
waiting
period),
as
opposed
to
only
purchasing
an
amount
of
$3,500.
Mr.
Corse
submitted
a
letter
from
his
former
employer
"Chemetics"
-
without
objection
on
the
part
of
the
respondent
—
which
read:
Re:
Pension
Adjustment
for
1990
T4
In
reply
to
your
letter
of
April
12th,
1993
to
C.S.M.
Shepherd,
in
1990
you
were
a
member
of
the
pension
plan.
You
were
hired
on
March
29,
1989
and
after
one
year’s
waiting
period
on
March
29,
1990
you
were
enrolled
in
to
the
Chemetics
pension
plan.
Therefore
you
should
have
had
a
pension
adjustment
on
your
T4
for
1990.
When
you
terminated
employment
on
February
14,
1991,
you
had
no
yet
achieved
two
years
in
the
pension
plan
for
vesting
purposes.
Therefore
you
were
not
entitled
to
any
benefit
under
the
pension
plan.
For
Revenue
Canada’s
purposes
this
letter
should
explain
that
at
the
time
the
1990
T4
pension
adjustment
was
completed
correctly,
but
due
to
your
termination
of
employment
in
1991
you
were
entitled
to
no
benefits.
This
was
followed
by
a
further
letter
dated
July
29,
1991:
Following
our
telephone
conversation
last
week,
I
must
admit
to
misleading
you
regarding
our
pension
plan
and
your
potential
benefit
from
the
plan.
While
you
became
a
member
of
the
plan
in
March
1990
after
12
months’
employment,
you
needed
to
be
in
the
plan
at
least
two
years
to
become
"vested”
and
thereby
eligible
for
pension
benefit
or
commuted
value.
You
were
not
in
the
plan
for
two
years
and
therefore
will
not
receive
a
benefit
from
the
plan.
I
apologize
for
my
mistake.
I
am
not
familiar
with
the
treatment
of
the
"pension
adjustment"
figure
on
your
1990
T-4
with
regard
to
your
potential
RRSP
contribution
for
1991
and
may
I
suggest
you
check
with
Revenue
Canada
regarding
whether
you
can
ignore
the
pension
adjustment
or
not.
It
was
the
appellant’s
contention
that
there
would
have
been
an
amended
T-4
slip
issued
by
Chemetics
except
for
the
fact
that
the
company
had
closed
down
and
there
were
no
employee
files
available,
nor
management
staff
to
carry
that
out
when
he
was
reassessed
by
Revenue
Canada
in
1992.
For
the
respondent
the
issue
is
simple
-
at
the
time
he
was
employed
(1990)
he
was
a
person
"who
may
become
entitled
to
benefits”
(see
Subparagraph
146(5)(a)(l)
of
the
Act).
Further
the
respondent’s
counsel
pointed
to
the
case
of
Zingel
v.
M.N.R.,
[1980]
C.T.C.
2466,
80
DTC
1424,
wherein
there
are
circumstances
closely
related
to
this
appeal
and
which
concluded
at
page
???
(D.T.C.
1425):
In
my
view,
it
is
evident
that
"in
the
year"
in
question
the
appellant
"was
a
person"
who
"may"
become
entitled
to
benefits
under
a
pension
fund
or
plan.
It
is
just
as
evident,
because
of
the
nature
of
his
work,
that
the
prospect
of
such
benefit
was
remote
indeed,
but
it
did
exist,
and
the
Minister
is
therefore
correct
in
his
assessment.
Analysis
If
indeed
the
circumstances
of
this
appeal
were
identical
to
those
in
Zingel,
supra,
the
result
should
be
the
same.
A
critical
fact
in
Zingel
was
that
there
remained,
even
at
the
date
of
the
appeal
hearing,
a
prospect
of
some
benefits,
no
matter
how
slight
that
prospect,
and
it
therefore
could
be
said
that
Mr.
Zingel
"may"
become
entitled
to
benefits.
Mr.
Corse
in
this
appeal
was
not
nor
might
he
become
entitled
to
benefits
as
at
the
date
he
was
preparing
his
income
tax
return
which
was
March
1,
1991.
Zingel,
supra,
would
indicate
that
the
phrase
"who
is
or
may
become
entitled
to
benefits"
refers
to
the
same
time
frame
as
that
during
which
the
"taxpayer
was
employed".
Mr.
Corse,
on
the
other
hand,
in
this
appeal
contended
that
the
point
in
time
at
which
that
phrase
should
be
related
could
be
the
time
when
the
taxpayer
was
claiming
the
deduction
"in
computing
the
income
for
a
taxation
year".
I
am
inclined
to
see
that
Mr.
Corse
has
reached
the
more
appropriate
view
of
the
portions
of
the
Act
under
consideration.
As
of
March
1,
1991
according
to
all
the
information
available
in
this
matter,
Mr.
Corse
neither
was,
nor
could
he
become,
entitled
to
the
benefits
under
the
company
plan
-
he
simply
had
not
been
employed
for
two
years.
It
seems
to
me
that
faced
with
that
prospect
on
February
15,
1991
(the
day
after
termination),
he
could
even
have
gone
out
and
purchased
the
RRSP
in
the
amount
of
$7,500,
well
within
the
60
day
time
limit
after
the
end
of
the
1990
year.
I
fail
to
see
in
this
portion
of
the
Act
the
procedure
by
which
Mr.
Corse
can
be
denied
the
claim
he
seeks.
The
appeal
is
allowed.
Appeal
allowed.