Quigley v. The Queen, 2003 TCC 872

REASONS FOR JUDGMENT

(delivered orally from the Bench at

Toronto, Ontario on September 12, 2003)

Woods J.

[1]      This is an appeal by William Quigley in respect of income tax assessments for the 1993 through 1997 taxation years, inclusive.

[2]      During the relevant taxation years, Mr. Quigley worked as a roofer, both as a crew leader and as a helper. The items in dispute concern income and expenses from various engagements either as a crew leader or helper.

[3]      I will deal with the items in issue in the order listed in paragraph d) of the notice of appeal.

[4]      The first item concerns an amount of $2,530 purportedly received in 1993 from Burnhamthorpe Roofing. Mr. Quigley stated that the Minister of National Revenue (the "Minister") incorrectly included in Mr. Quigley's income amounts that were paid to helpers during a period that Mr. Quigley worked as a crew leader. He indicated, however, that this overstatement of income was partly offset by another job that the Minister had not taken into account. I am not satisfied with Mr. Quigley's explanation with respect to this amount. Mr. Quigley failed to introduce any supporting evidence with respect to the other source of income. Accordingly, I find that the amount of $2,530 should be included in computing Mr. Quigley's income for the 1993 taxation year.

[5]      The second item concerns an amount of $8,412 purportedly received in 1997. In this case, I am satisfied with Mr. Quigley's explanation that this amount had been included in his income based on the financial records that he submitted. In my view, it is noteworthy that the Crown did not introduce any evidence to rebut Mr. Quigley's submission on this issue. Accordingly, I find that the amount of $8,412 should not be included in computing Mr. Quigley's income for the 1997 taxation year.

[6]      The next item concerns amounts of $1,221 and $5,283 included in computing income as taxable benefits in the 1996 and 1997 taxation years respectively. The Crown conceded that these amounts should not be included in computing income. I accept this concession.

[7]      The next item concerns disallowed expenses of $11,586 for the 1993 taxation year, $13,299 for the 1994 taxation year, $9,750 for the 1995 taxation year and $5,984 for the 1996 taxation year. At the hearing, the Crown conceded the deductibility of union dues of $440 for each of 1994, 1995 and 1996. I accept this concession. In respect of the balance of the disallowed expenses, I find that these expenses are personal expenses and were not incurred for the purpose of earning income. Mr. Quigley put as the only issue with respect to these items whether he was an employee or independent contractor. He chose not to introduce evidence as to the nature of the expenses and documentation to prove such amounts. Mr. Quigley had the onus of establishing the business nature of these expenses and this onus has not been met. As a result of this finding, it is not necessary for me to make a finding with respect to whether Mr. Quigley was an employee or independent contractor. In any event, I find that there was insufficient evidence for me to make a finding on this issue. Accordingly, except for the union dues, the deduction of these items will be disallowed.

[8]      The next item concerns an amount of $3,388 purportedly received in 1997. This item should be dealt with in the same manner as the other item of income in dispute for 1997. Accordingly, I find that this item should not be included in computing Mr. Quigley's income.

[9]      The next item is a penalty of $1,560 that was assessed for the 1997 taxation year. The Minister has conceded that this penalty should not be imposed and I accept this concession.

[10]     During the course of the hearing, I requested counsel for the Crown to submit to me in writing the concessions that she made orally at the hearing. Apparently Mr. Quigley did not agree that a written statement should be given to me and accordingly, I have dealt with the Crown's concessions without this.

[11]     I will allow the appeal, without costs, and refer the assessments back to the Minister of National Revenue for reconsideration and reassessment in accordance with these reasons.

Signed at Ottawa, Canada, this 2nd day of December, 2003.

J.M. Woods, J.