Section 289

Cases

MNR v. Paypal Canada Co., Docket T-564-17 (FCTD), 10 November 2017

authorization to demand transaction summaries for the PayPal business account users

Gascon J granted an authorization for CRA to issue a requirement under ITA s. 231.2 and ETA s. 289 on Paypal Canada to disclose the names and addresses (etc.) of corporations and individuals holding a business account with PayPal that had used PayPal's online payment platform in the course of their commercial activities during the period from January 2014 to date, and to provide the total number and value of payments received and made for those years. He stated that "the expectation of privacy with respect to business records … is very low" and that "the information sought … is required in the context of verification activities undertaken … to determine whether the Unnamed Persons have filed their required tax returns."

Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 231.2 - Subsection 231.2(3) all Paypal business account dollar volumes and names required to be disclosed 200

Piersanti v. Canada, 2014 FCA 243

propriety of evidence collection for criminal purposes is irrelevant to its admissibility in tax appeals

The taxpayer had been convicted of over 30 GST-related offences. In the course of appealing the related reassessments, she moved, on Charter grounds, to exclude from evidence any information the Minister obtained from Requests for Information, arguing that the RFIs were made in the course of a criminal investigation.

The trial judge dismissed the taxpayer's motion, finding that the situation involved a concurrent criminal investigation and audit. Trudel JA further added (at para. 9):

The Judge's legal finding accords with Jarvis and with the self-assessment and the self-reporting nature of the income tax regime. Whether the CRA could properly use such documents to prosecute the appellant for criminal offences under the ETA is irrelevant to the current civil proceedings.

In any event, even if the taxpayer were correct that her rights were breached, it was "at best a technical breach" which did not call for a remedy under s. 24(2) of the Charter (para. 9).

Locations of other summaries Wordcount
Tax Topics - Other Legislation/Constitution - Charter (Constitution Act, 1982) - Section 8 propriety of evidence collection for criminal purposes is irrelevant to its admissibility in tax appeals 151
Tax Topics - Income Tax Act - Section 231.1 - Subsection 231.1(1) propriety of evidence collection for criminal purposes is irrelevant to its admissibility in tax appeals 151

Subsection 289(1)

Cases

Canada (Revenu national) v. Les Développements Béarence Inc., 2019 CF 22

no requirement to provide information in reformatted form

The taxpayer (Béarence) had failed to comply with an order of the Federal Court requiring it to provide, within five days, an Excel file containing all the daily transactions for its 2012 to 2015 years. In finding that Béarence could not now be found to be in contempt of court, Bell J accepted Béarence’s submission that CRA already had available to it all the information it needed to perform its audit and stated (at para. 18, TaxInterpretations translation):

[N]either the CRA nor this Court can impose the format in which this information must be provided to the CRA, as all the necessary information has already been provided.

Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 231.7 - Subsection 231.7(4) CRA cannot require a taxpayer to reformat its information for CRA’s reading convenience 298
Tax Topics - Income Tax Act - Section 231.2 - Subsection 231.2(1) no obligation to reformat previously-provided information 140

Subsection 289(3)

Cases

Canada (National Revenue) v. Hydro-Québec, 2018 CF 622

commercial customers of utility were not a group relevant to determining their ETA compliance

The Minister sought judicial authorization under ITA s. 231.2(3) and ETA s. 289(3) for making a demand of Hydro-Quebec to furnish listed particulars (e.g., address for invoicing and of electricity use, late payment identification and telephone number) for all its commercial customers who were charged the regular electricity rate – so that CRA could compare this information with what it had in its own files.

Roy J declined authorization. First, he did not think that all the regular commercial customers of a utility was an “ascertainable group” as contemplated in s. 231.2(3)(a), as the defining characteristics had no discernable link to compliance with the ITA and ETA. While they were at it, why not define group members as any resident of Quebec? (para. 98)

In finding that the request also did not satisfy the s. 231.2(3)(b) requirement that it be “made to verify compliance,” he stated (at para. 79):

The particulars of the commercial customers of Hydro-Quebec are, at best, upstream from information for the audit of their compliance with the ITA.

Finally, he indicated that even if the specific s. 231.2 (and ETA) requirements had been met, he would have rejected the Minister’s submission that once such conditions were satisfied, the Court was required to issue an authorization - and have exercised his discretion against such an "intrusion in private life" (para. 96). He stated (at para. 96):

A certain form of fishing expedition is permitted, but judicial authorization, with its inherent discretion, is there to limit and temper it. To me this seems essential where a fishing expedition is of unparalleled amplitude and the requested information is remote from an audit of compliance with the Act.

Locations of other summaries Wordcount
Tax Topics - Income Tax Act - Section 231.2 - Subsection 231.2(3) Hydro-Quebec not required to furnish information on its commercial customers 409