Docket: 2007-87(IT)I
BETWEEN:
VICTOR B. NEAL,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
____________________________________________________________________
Appeal
heard on June 12, 2007, at Kingston, Ontario.
Before: The Honourable
Justice Wyman W. Webb
Appearances:
|
For the Appellant:
|
The
Appellant himself
|
|
Counsel for the Respondent:
|
Richard Gobeil
|
____________________________________________________________________
JUDGMENT
The appeals from the assessments made under
the Income Tax Act for the 2002, 2003 and 2004 taxation years are dismissed,
without costs.
Signed at Halifax, Nova
Scotia, this 18th day of June 2007.
"Wyman W. Webb"
Citation: 2007TCC349
Date: 20070618
Docket: 2007-87(IT)I
BETWEEN:
VICTOR B. NEAL,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
REASONS FOR JUDGMENT
Webb J.
[1] The Appellant
claimed deductions for the following amounts as Child Support payments in
computing his income for the purposes of the Income Tax Act ("Act")
for the following years:
|
Taxation Year
|
Amount Claimed
|
|
2002
|
$3,450
|
|
2003
|
$6,900
|
|
2004
|
$6,900
|
[2] Paragraph 60(b) of
the Act is the paragraph which permits the deduction for amounts paid
for maintenance and support. This paragraph provides as follows:
60: There may be deducted in computing a taxpayer's income for
a taxation year such of the following amounts as are applicable:
...
(b) the total of all amounts each of which is an
amount determined by the formula
A - (B + C)
where
A is the total of all amounts each of which
is a support amount paid after 1996 and before the end of the year by the
taxpayer to a particular person, where the taxpayer and the particular person were
living separate and apart at the time the amount was paid,
B is the total of all amounts each of which
is a child support amount that became payable by the taxpayer to the particular
person under an agreement or order on or after its commencement day and before
the end of the year in respect of a period that began on or after its
commencement day, and
C is the total of all amounts each of which
is a support amount paid by the taxpayer to the particular person after 1996
and deductible in computing the taxpayer's income for a preceding taxation
year;
[3] Therefore in order
for any payment to be deductible it must be included in A in the formula and
therefore must be a support amount. Subsection 60.1(4) of the Act
provides that the definitions in subsection 56.1(4) apply for the purposes
of section 60.
[4] The definition of
"support amount" is found in subsection 56.1(4) and is as follows:
"support amount" means an amount payable or receivable as
an allowance on a periodic basis for the maintenance of the recipient, children
of the recipient or both the recipient and children of the recipient, if the
recipient has discretion as to the use of the amount, and
(a) the recipient is the spouse or common‑law
partner or former spouse or common‑law partner of the payer, the
recipient and the payer are living separate and apart because of the breakdown
of their marriage or common‑law partnership and the amount is
receivable under an order of a competent tribunal or under a written agreement;
or
(b) the payer is a
legal parent of a child of the recipient and the amount is receivable under an
order made by a competent tribunal in accordance with the laws of a province.
(emphasis added)
[5] In this particular
case the Appellant and his spouse separated in 1995. The Appellant started to
make support payments of $575 per month after they separated. The Appellant did
not produce any agreement or Court Order applicable in 1995, 1996, 1997 or 1998.
Therefore the amounts that were paid by the Appellant to his spouse prior to
1999 were paid pursuant to an oral agreement between the Appellant and his
spouse.
[6] The Appellant
introduced as an exhibit a copy of the Order of the Ontario Court (General
Division) dated December 10, 1998 in which paragraph 2 of this Order provides
as follows:
This Court orders that the petitioner shall pay to the respondent
for the support of the child of the marriage the sum of $575 per month payable
on the 1st day of each month commencing January 1, 1999 and continuing monthly
thereafter.
The petitioner under this Order is the Appellant in
this case.
[7] As a result the
first written agreement or Court Order related to the amount to be paid by the
Appellant to his spouse is the Order dated December 10, 1998 of the
Ontario Court (General Division). Therefore there is no
"support amount" until the Order was granted in 1998 as prior to
that time there was no written agreement or Order of any competent tribunal
related to the amount paid by the Appellant.
[8] Since the Order is
dated in 1998, the "commencement day" is December 10, 1998
pursuant to paragraph (a) of the definition of "commencement
day" in subsection 56.1(4) of the Act.
[9] As a result, the
formula in paragraph 60(b) will produce a nil result. The amounts for A in the
formula for each of the years in question were the amounts as stated in the above
table. However, the amounts for B in the formula will also be the same amounts
for all three years as the amounts all relate to child support payments, as
defined in subsection 56.1 (4) of the Act, as the amounts were paid for
the support of the child.
[10] The appeal is dismissed
without costs.
Signed at Halifax,
Nova Scotia, this 18th day of June 2007.
"Wyman W. Webb"
CITATION: 2007TCC349
COURT FILE NO.: 2007-87(IT)I
STYLE OF CAUSE: VICTOR B. NEAL AND HER MAJESTY THE QUEEN
PLACE OF HEARING: Kingston, Ontario
DATE OF HEARING: June 12, 2007
REASONS FOR JUDGMENT BY: The
Honourable Justice Wyman W. Webb
DATE OF JUDGMENT: June 18, 2007
APPEARANCES:
|
For the
Appellant:
|
The Appellant himself
|
|
Counsel for the
Respondent:
|
Richard Gobeil
|
COUNSEL OF RECORD:
For the Appellant:
Name:
Firm:
For the
Respondent: John H. Sims, Q.C.
Deputy
Attorney General of Canada
Ottawa,
Canada
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