Hamlyn
T.CJ.:
This
appeal
is
for
the
Appellant’s
1994
taxation
year.
In
computing
income
for
the
1994
taxation
year,
the
Appellant
included
in
income
a
payment
in
respect
of
accumulated
sick
leave
credits
in
the
amount
of
$23,661.38
received
from
Mohawk
College.
The
Minister
of
National
Revenue
(the
“Minister”)
assessed
the
Appellant
for
the
1994
taxation
year
as
filed,
Notice
of
Assessment
thereof
mailed
on
July
20,
1995.
The
Minister
made
the
following
assumptions
of
fact:
—
Mohawk
College
advised
the
Appellant
that,
at
his
request,
he
could
receive
a
pay-out
of
his
accumulated
sick
leave
credits;
(this
assumption
was
admitted
by
the
Appellant)
—
at
the
Appellant’s
request,
Mohawk
College
paid
the
amount
to
the
Appellant
in
the
1994
taxation
year
as
a
pay-out
of
sick
leave
credits;
(this
assumption
was
admitted
by
the
Appellant)
—
the
amount
was
other
remuneration
received
by
the
Appellant
in
1994,
from
his
office
or
employment
(this
assumption
was
not
admitted
by
the
Appellant).
Issue
The
issue
to
be
decided
is
whether
the
amount
of
$23,661.38
is
to
be
included
in
computing
the
Appellant’s
income
for
the
1994
taxation
year.
Legislation
Section
5
of
the
Income
Tax
Act
provides
that
salary,
wages
and
other
gratuities
be
included
in
the
taxpayer’s
income
as
income
from
an
office
or
employment.
Section
6
extends
the
amount
to
be
included
in
income
to
the
various
fringe
benefits
which
an
employee
or
officer
may
receive
in
respect
of,
in
the
course
of,
or
by
virtue
of
office
or
employment.
The
Appellant’s
Position
The
Appellant’s
position
is
that
cashed
out
sick
leave
credits
should
not
be
taxed
as
income.
Analysis
The
sick
leave
credits
were
fixed
accumulated
credits
that
belonged
to
the
Appellant
as
part
of
the
employment
contract.
When
the
Appellant
chose
to
cash
out
sick
leave
credits
during
employment,
a
reduction
penalty
applied
by
the
employer
(25%)
and
the
balance
was
then
paid
out
to
the
Appellant,
subject
to
deductions.
The
right
to
withdraw
was
precise
and
definite
subject
only
to
employer
imposed
limitations
as
to
how
many
employees
could
cash
out
sick
leave
credits
annually.
This
limitation
did
not
affect
the
Appellant’s
request.
Conclusion
The
calculation
of
sick
leave
credits
cash-out
was
fixed
and
uncondi-
tional
and
once
calculated
became
the
property
of
the
employee
and
not
the
employer.
The
cashed
out
credits
were
a
benefit
received
by
the
Appellant
in
1994
by
virtue
of
his
employment
with
Mohawk
College
and,
as
such,
upon
receipt
in
1994
was
properly
included
in
income.
Decision
The
appeal
is
dismissed.
Appeal
dismissed.
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