Date: 19980529
Docket: 97-2099-IT-I
BETWEEN:
ALFRED YEBOAH,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
Reasons for Judgment
Hamlyn, J.T.C.C.
[1] The Appellant appeals from assessments of tax by the Minister of National Revenue (the "Minister") for the 1993 and 1994 taxation years, notices of which are dated August 19, 1996, by which the Minister: disallowed the deduction from tax payable of a personal credit for married status under paragraph 118(1)(a) of the Income Tax Act (the "Act") for the 1993 taxation year; disallowed the deduction from tax payable of a personal credit for dependants under paragraph 118(1)(d) of the Act in the 1993 taxation year; disallowed a deduction for child care expenses under section 63 of the Act in the 1993 taxation year; and disallowed a deduction for alimony or maintenance payments under section 60 of the Act in the 1994 taxation year.
[2] The Appellant also appeals from the disallowance of the Ontario Tax Credits in his 1993 and 1994 taxation years.
[3] With respect to the balance of the claims, the Appellant states, in relation to the personal credit for married status, that he was in a common-law relationship with Ama Asantewaa for a period of 14 months which included the 1993 taxation year and therefore is entitled to the credit. With respect to the personal credit for dependants, the Appellant claims that his father resided with him in the 1993 taxation year and was a "dependant" within the meaning of the Act. With respect to the child care expenses, the Appellant claims that the amount claimed was paid to Comfort Addai for baby-sitting his son in the 1993 taxation year. The Appellant also claims that he made alimony payments to his spouse Geogina Yeboah, during a period of separation, in the 1994 taxation year. The Appellant submits that the money was paid pursuant to a mutual separation agreement between the parties.
[4] The position of the Minister is summarised in the Reply to the Notice of Appeal, wherein the Minister states the following assumptions of fact upon which he relied in assessing the Appellant:
CHILD CARE EXPENSES
(a) in the 1993 taxation year, the Appellant's child (Kwabena Appiah) lived in Ghana;
(b) the Appellant's child was at all material times a non-resident;
(c) al all relevant times, the Appellant did not incur child care expense for the purposes of providing in Canada child care services for an eligible child (Kwabena Appiah) of the Appellant;
ALIMONY OR MAINTENANCE
(d) alimony or maintenance paid was not paid pursuant to a decree, order, or judgment of a competent tribunal or pursuant to a written agreement, as alimony or other allowance payable on a periodic basis for the maintenance of the recipient thereof, children of the marriage, or both the recipient and the children of the marriage;
(e) the Appellant was not separated pursuant to a divorce, judicial separation or written agreement from his spouse or former spouse to whom he made the payments at the time the payments were made and throughout the remainder of 1994 taxation year;
EQUIVALENT-TO-SPOUSE
(f) in the 1993 taxation year, the Appellant made a claim for equivalent-to-spouse amount in respect of his common law spouse, Anna Asantewaa;
(g) the Appellant's spouse was living separate and apart from the Appellant at the end of the 1993 taxation year;
(h) at no time during 1993 did the Appellant cohabit with another person of the opposite sex in a conjugal relationship with whom he had so cohabited throughout a twelve month period ending before that time, nor did he cohabit with any such person who was the parent of a child of whom the Appellant was also a parent;
ADDITIONAL PERSONAL AMOUNT
(i) in the 1993 taxation year, the Appellant made a claim for additional personal amount in respect of is father, Yaw Kobi;
(j) in the 1993 taxation year, the Appellant's father (Yaw Kobi) lived in Ghana;
(k) the Appellant's father was at all material times a non-resident;
(l) at no time in the 1993 taxation year was the Appellant's father dependent on the Appellant for support;
RENTAL PAYMENTS
(m) rental payments were not incurred by the Appellant.
ONTARIO TAX CREDITS
[5] In relation to the Ontario Tax Credits, the Minister also submits, in the Reply to the Notice of Appeal, that this Court is without jurisdiction to grant relief to the Appellant in respect of the Ontario Tax Credits. This heading of relief was not pursued by the Appellant in the Notice of Appeal and I agree it is well established this Court does not have the jurisdiction to entertain an appeal from an assessment of tax under the Ontario Income Tax Act.
REMAINING ISSUES
[6] The issues to be decided are:
- is the Appellant entitled to a personal credit for married status in the 1993 taxation year;
- is the Appellant entitled to a personal credit for dependants in the 1993 taxation year;
- is the Appellant entitled to deduct child care expenses in the 1993 taxation year; and
- is the Appellant entitled to deduct alimony or maintenance payments in the 1994 taxation year.
ANALYSIS AND CONCLUSION
[7] As in all cases of this nature the Appellant has the onus, that is the burden of proof, of establishing his claims.
[8] In this case much of the evidence was confused and divergent.
PERSONAL CREDIT FOR MARRIED STATUS
[9] The Appellant has claimed a personal credit in respect of his common law spouse.
[10] The word "spouse", for the period after 1992 is defined under subsection 252(4) to include a person of the opposite sex who cohabits with the taxpayer in a conjugal relationship and has done so throughout a 12 month period.
[11] The Appellant's direct evidence was that the separation from his wife was effective March 10, 1992. The Appellant's direct evidence was that the cohabitation with his common law spouse commenced in December 1992 and lasted through to February 1994.
[12] Counsel for the Minister presented to the Appellant Schedule 6 of his 1993 tax return wherein in response to the question:
If your marital status changed in 1993, give the date of the change.
His reply was:
Day 02 Month 03
I therefore conclude the Appellant states his marital status changed on March 2, 1993 and this response is a conflict with his direct evidence.
[13] This written response takes the Appellant's facts outside the 12 month period of subsection 252(4).
[14] With this inconclusive evidence the spousal credit claim is dismissed.
PERSONAL DEPENDANT CREDIT
[15] The Appellant claims his father resided with him during the 1993 taxation year. The Appellant states the father arrived at his doorstep, with the Appellant's son, apparently from the United States, and lived with him from April 1993 to May 1994. Thereafter the Appellant's father, the Appellant states, returned to Ghana with his son.
[16] It has been said a state of dependency does not arise simply because of the existence of the relationship of parent and child.[1]
[17] However, the evidence was that the father, who was ill[2], sought refuge with the Appellant, came to live with the Appellant for a period of time albeit the father still maintained a home in Ghana and did in fact eventually return to his home in Ghana.
[18] On balance, I conclude that the Appellant's father was in fact dependant on the Appellant for the period of time he resided in Canada.
CHILD CARE EXPENSES
[19] The child who arrived with the grandfather was living with the Appellant when the alleged child care expenses were incurred and it was stated the purpose of the child care expenses was to allow the Appellant to work. The Appellant stated he paid $150.00 per week for eight months in 1993 for child care services.
[20] The problem that exists here, as in other parts of this case, is the conflicting evidence. The Appellant, in evidence, stated that the person who provided the child care services was one Comfort Addai and a receipt was signed by Comfort Addai ($3,150.00) (Exhibit R-2).
[21] When presented with his 1993 tax return (Exhibit R-1), the Appellant said that one Mercy Oppong provided the child care services and the child care monies were paid to Mercy Oppong ($3,050.00).
[22] Clearly, the alleged monies paid are in conflict and who performed the service is in conflict. The Appellant has not discharged the onus on a balance of probabilities and on this issue the Minister's assessment is upheld.
MAINTENANCE PAYMENTS
[23] The Appellant claims he was separated from his spouse Geogina Yeboah in the 1994 taxation year and that he made support payments pursuant to an agreement between the parties. Notwithstanding his claim of separation during the 1994 taxation year the Appellant apparently resumed cohabitation with his wife and a son was born. The specific period of cohabitation was not clearly specified.
[24] No evidence of a written separation agreement signed by both the Appellant and his spouse was presented to the Court.
[25] In the absence of any separation agreement signed by both parties before the Court, the appeal on this issue can not be sustained.
DECISION
[26] The appeal from the assessment for the 1993 taxation year is allowed and the assessment is referred back to the Minister of National Revenue for reconsideration and reassessment on the basis that the Appellant's father was dependant on the Appellant for a period of nine months (April to December) in 1993 pursuant to the claim for dependants (subsection 118(1)(d) of the Act).
[27] The appeal from the assessment for the 1994 taxation year is dismissed.
[28] The Appellant is entitled to no further relief.
Signed at Ottawa, Canada, this 29th day of May 1998.
"D. Hamlyn"
J.T.C.C.