REASONS
FOR JUDGMENT
V.A. Miller J.
[1]
The Appellant failed to file income tax returns
for the 2001 and 2002 taxation years and the Minister of National Revenue (the “Minister”)
assessed him on October 26, 2009 pursuant to subsection 152(7) of the Income
Tax Act (the “ITA”).
[2]
In assessing the Appellant, the Minister made
the following assumptions of fact:
2001 Taxation Year
a)
in the 2001 taxation year, the appellant was
engaged by Canada Post to provide mail delivery services as an independent
contractor;
b)
on December 7, 2001, the appellant assigned his
rights and responsibilities with respect to the agreement between himself and
Canada Post, dated August 29, 2001, to 1483740 Ontario Ltd.;
c)
1483740 Ontario Ltd. was wholly owned by the
appellant;
d)
1483740 Ontario Ltd. was incorporated November
14, 2001;
e)
1483740 Ontario Ltd. reported $nil revenue and
$nil income in its return of income for the 2001 taxation year;
f)
in the 2001 taxation year, Canada Post paid
$13,333 to the appellant as remuneration for services he provided;
g)
at all relevant times, the appellant was also
engaged in the direct selling of products from For-Mor-Canada Inc., to
customers as an independent agent;
h)
in the 2001 taxation year, For-Mor Canada Inc.
paid $1,595 in commission income to the appellant;
i)
for the 2001 taxation year, Greenock Resources
also paid $1,293 in commission income to the appellant;
2002 Taxation Year
j)
the Minister completed a trust audit exam of the
payroll account for 1483740 Ontario Inc. for its 2002 taxation year;
k)
in the 2002 taxation year, 1483740 Ontario Inc.
paid $28,082 to the appellant;
l)
for the 2002 taxation year, this Court [2007 TCC
258] held that the appellant was a subcontractor of 1483740 Ontario Inc. and
received approximately $2,400 per month as remuneration for his services;
m) for the 2002 taxation year, For-Mor Canada Inc. paid $1,016 in
commission income to the appellant; and
n)
for the 2002 taxation year, Canada Post paid
$2,666 to the appellant.
[3]
At the hearing, the Appellant agreed with all of
the assumptions except paragraph (i). He stated that he did receive $1,293 in
commission income in 2001 but it was from Alive International Inc. and not
Greenock Resources.
[4]
In May 2002, the Canada Revenue Agency (“CRA”)
issued a Demand that the Appellant file his 2001 income tax return. He replied
to the Demand by questioning (i) whether the Demand was in compliance with
subsections 150(1) and (2) of the ITA and (ii) who was the person
claiming to have not received the return. He did not file his returns for 2001
or 2002.
[5]
At the beginning of the hearing, the Appellant
stated that he did not intend to be adversarial; he was in court to represent
the “little people” by finding ways to minimize his taxes. It was his position
that in 2001 and 2002 he was engaged as an independent contractor and the ITA
did not apply to independent contractors. He also argued that the ITA is
incomprehensible to the common person and it should not apply.
[6]
Although the Appellant stated that he did not
belong to a particular group, he used the concepts and terminology associated
with the Organized Pseudolegal Commercial Argument (“OPCA”) litigant who was
described by J.D. Rooke A.C.J.Q.B. in Meads v Meads, 2012 ABQB 571. The
Appellant relied on a plethora of legislation (none of which was relevant
except the ITA); legal maxims; definitions from the Canadian Law
Dictionary; forms and letters from the CRA; and forms from various departments
in the Ontario government. He stated that the forms from the CRA were not clear
whereas the forms from the Ontario government were unambiguous; he questioned
whether the T1 form with the General Income Tax and Benefit Guide was
“legitimate”; and, whether the CRA represents the Minister of National Revenue.
It appeared to me that the essence of his argument was that the definition of
“person” in the ITA did not clearly state that it applied to him as a
“human being, a private individual” and an independent contractor.
[7]
It is my view that the Appellant, like most
litigants who use the tactics of saying that the ITA does not apply to
them, did not really misunderstand the ITA. In the present case, the
Appellant did not misunderstand the definition of “person” in the ITA.
His actions and letters to the CRA indicated a “conscious intention to
disobey”. See Meads (supra) at paragraph 561. The Appellant was
not trying to minimize his taxes but was avoiding the payment of any taxes.
There was absolutely no merit to any of his arguments.
[8]
In conclusion, the Appellant was a “person”
resident in Ontario, Canada in 2001 and 2002 and the income he received in
those years is taxable. There was never a dispute that he received income of
$16,221 and $31,764 in 2001 and 2002 respectively and that he did not file his
income tax returns for those years. Late filing penalties were correctly
assessed against the Appellant. The appeal is dismissed.
Signed at Ottawa, Canada, this 17th day of July 2014.
“V.A. Miller”
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