McArthur T.C.J.:
The Appellant appeals his 1996 assessment by the Minister of National Revenue wherein the Appellant was assessed interests on instalments in the amount of $450.40 and arrears interest of $2.34.
The question is whether the Appellant is liable to pay deficient instalment interest for the 1996 taxation year.
The Appellant is a practicing lawyer in Thunder Bay, Ontario. His net income from professional activities in 1996 was $ 12,970 . Because of his low earnings he elected to include $23,000 from a prior year’s earning reserve as of December 31, 1995.
The Appellant’s Position (L2/R3630/T0/BT0) test_marked_paragraph_end (432) 1.041 0436_2681_2851
The $23,000 was not earned in 1996. Instalments were not required on $37,843, but only on $12,970.
The Respondent’s Position (L16/R3478/T0/BT0) test_marked_paragraph_end (152) 1.023 0436_3589_3755
The Appellant chose to bring an additional $23,000 into income in 1996 which formed part of his income in accordance to sections 156, 156.1 and 161 of the Income Tax Act (the "Act").
Legislation (L2/R4738/T0/BT0) test_marked_paragraph_end (2078) 1.034 0436_4713_4881
Subsection 156( 1 ) of the Act provides for the payment of tax instalments by individuals who do not have tax deducted at source. The instalment is based on the estimated tax for the year or the taxpayer’s instalment base for the immediately preceding year.
In Newland v. R. (1997), 97 D.T.C. 1391 (T.C.C.), the taxpayer submitted that he should not be liable for instalments based on unearned or unrealized and unknown future income that will materialize later in the year and was unforeseen when he should normally have been required to make an instalment. Judge Dussault held:
The requirements of subsection 156(1) for making quarterly instalments are clear and unambiguous. The alternative methods of computation are also clearly stated. The same can be said of subsection 161(2) dealing with interest on insufficient instalments and the limitation of subsection 161(4.01) stating that the taxpayer is liable for interest with respect to the lesser of the four amounts mentioned. Although the Appellant realistically felt that he could only make his quarterly instalments by reference to his estimate of the tax payable for the year, he must be held liable for interest according to subsections 161(2) and 161(4.01) of the Act as those instalments proved to be insufficient.
It would not serve any useful purpose to discuss the merit of the Appellant’s suggestions for improving fairness of the system because, as it is readily appar- ent, the remedies he is seeking are not within the powers of Revenue Canada or this Court, but lie only with Parliament.
The same reasoning applies to the present circumstances.
1 find that the Minister properly assessed and that the Appellant is liable to pay interest for late or deficient instalment payments, with respect to the 1996 taxation year, in the amount of $450.40, on the part of the instalment of tax that the Appellant failed to pay, in accordance to the provisions of sections 156, 156.1 and 161 of the Act and for the interest thereon.
The appeal is dismissed.
Appeal dismissed.
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