Date: 20020625
Docket:
2001-3774-IT-I
BETWEEN:
JON T.
MEERS,
Appellant,
and
HER MAJESTY THE
QUEEN,
Respondent.
Reasonsfor
Judgment
Little J.
[1]
The Appellant completed his ministerial studies at Canadian
Nazarene College in Winnipeg, Manitoba and was ordained as a
pastor in the Church of the Nazarene (the "Church") in
Kamloops, British Columbia in June 1993.
[2]
The Appellant has served as the pastor of the Church since
1993.
[3]
The Appellant received T-4 supplementaries issued by the Church
which indicate that the Appellant received employment income of
$2,600.00 from the Church for each of the 1995, 1996 and 1997
taxation years.
[4]
In the 1995, 1996 and 1997 taxation years the Appellant was also
employed by Canada Safeway Ltd. ("Safeway"). The
Appellant testified during the hearing that he had received
income of approximately $38,000.00 from Safeway in the 1995
taxation year. The Appellant said that his income from Safeway
for the 1996 and 1997 taxation years was not as much as he had
received in the 1995 taxation year.
[5]
In computing his income for the 1995, 1996 and 1997 taxation
years the Appellant claimed Clergyman's residence deductions
as follows:
1995
—
$ 9,240.00
1996
—
$12,105.74
1997
—
$14,304.00
[6]
An audit of the Appellant was conducted by officials of the
Canada Customs and Revenue Agency ("CCRA") in
connection with the Appellant's 1995 taxation year. By letter
dated October 10, 1996 an official of the CCRA stated that based
on their review of the Appellant's tax return no adjustments
were necessary. As a result of the position as outlined in the
letter from the CCRA official the Appellant filed his income tax
returns for the 1996 and 1997 taxation years following the same
basis for the Clergyman's residence deduction that he had
followed when he filed his 1995 tax return.
[7]
The Minister of National Revenue subsequently reassessed the
Appellant's 1995, 1996 and 1997 taxation years and allowed a
Clergyman's residence deduction of $2,600.00 for each
year.
ISSUE
[8]
The issue is whether the Appellant is entitled to claim a
deduction for Clergyman's residence in excess of $2,600.00
for each of the 1995, 1996 and 1997 taxation years.
ANALYSIS
[9]
In the 1995, 1996 and 1997 taxation years paragraph
8(1)(c) of the Income Tax Act (the
"Act") read as follows:
8(1) In computing a
taxpayer's income for a taxation year from an office or
employment, there may be deducted such of the following amounts
as are wholly applicable to that source or such part of the
following amounts as may reasonably be regarded as applicable
thereto:
. . .
(c)
Clergyman's residence - where the taxpayer is a member of the
clergy or of a religious order or a regular minister of a
religious denomination, and is in charge of or ministering to a
diocese, parish or congregation, or engaged exclusively in
full-time administrative service by appointment of a religious
order or religious denomination, an amount equal to
(i)
the value of the residence or other living accommodation occupied
by the taxpayer in the course of or by virtue of the
taxpayer's office or employment as such a member or minister
so in charge of or ministering to a diocese, parish or
congregation, or so engaged in such administrative service, to
the extent that that value is included in computing the
taxpayer's income for the year by virtue of section 6,
or
(ii)
rent paid by the taxpayer for a residence or other living
accommodation rented and occupied by the taxpayer, or the fair
rental value of a residence or other living accommodation owned
and occupied by the taxpayer, during the year but not, in
either case, exceeding the taxpayer's remuneration from the
taxpayer's office or employment as described in subparagraph
(i); (underlining added)
(Note:
Paragraph 8(1)(c) of the Act was amended by
Statutes of Canada 2001, chapter 17, section 3(2) applicable for
the 2001 and subsequent taxation years.)
[10]
Pursuant to the wording of subparagraph 8(1)(c)(ii) of the
Act as it read in the 1995, 1996 and 1997 taxation years I
have concluded that the deductions for Clergyman's residence
expenses are limited to the amount of the income received by the
Appellant from the Church in the year. It therefore follows that
the Appellant is only entitled to deduct Clergyman residence
expenses of $2,600.00 in each of the 1995, 1996 and 1997 taxation
years.
[11]
The appeals will be dismissed for each year.
[12]
From an analysis of the above facts it is apparent that the
Appellant was misled by statements made by officials of the CCRA
when he was advised that no adjustment to his income tax return
for 1995 was necessary. This Court has no authority to waive or
eliminate the interest that has been imposed in this situation.
Because of the misleading statement made by an official of the
CCRA, this may be a situation where the Minister should exercise
his discretion and waive the interest that has been imposed
against the Appellant for his 1995, 1996 and 1997 taxation
years.
Signed at Ottawa, Canada, this 25th day of
June 2002.
"L.M. Little"
J.T.C.C.
COURT FILE
NO.:
2001-3774(IT)I
STYLE OF
CAUSE:
Jon T. Meers and
Her Majesty the Queen
PLACE OF
HEARING:
Kamloops, British Columbia
DATE OF
HEARING:
June 11, 2002
REASONS FOR JUDGMENT
BY: The Honourable Judge L.M.
Little
DATE OF
JUDGMENT:
June 25, 2002
APPEARANCES:
For the
Appellant:
The Appellant himself
Counsel for the
Respondent:
Michael Taylor
COUNSEL OF RECORD:
For the
Appellant:
Name:
Firm:
For the
Respondent:
Morris Rosenberg
Deputy Attorney General of Canada
Ottawa, Canada
2001-3774(IT)I
BETWEEN:
JON T. MEERS,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
Appeal heard on June 11, 2002, at Kamloops,
British Columbia, by
the Honourable Judge L.M. Little
Appearances
For the
Appellant:
The Appellant himself
Counsel for the Respondent:
Michael Taylor
JUDGMENT
The appeals from the assessments made under
the Income Tax Act for the 1995, 1996 and
1997 taxation years are dismissed in accordance with the
attached Reasons for Judgment.
Signed at Ottawa, Canada,
this 25th day of June 2002.
J.T.C.C.
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