98-373(IT)I
BETWEEN:
LAYTON BEZAN,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
Appeals heard on June 25, 1999 at Regina, Saskatchewan, by
the Honourable Judge D.W. Beaubier
Appearances
For the Appellant: The Appellant himself
Counsel for the Respondent: Tracey Harwood-Jones
JUDGMENT
The appeals from the reassessments made under the Income Tax Act for the 1994 and 1995 taxation years are dismissed in accordance with the attached Reasons for Judgment.
Signed at Vancouver, Canada this 5th day of July, 1999.
|
"D.W. Beaubier |
J.T.C.C.
Date: 19990705
Docket: 98-373(IT)I
BETWEEN:
LAYTON BEZAN,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
REASONS FOR JUDGMENT
Beaubier, J.T.C.C.
[1] This appeal pursuant to the Informal Procedure was heard at Regina, Saskatchewan on June 25, 1999. The Appellant was the only witness.
[2] Paragraphs 7 and 8 of the Reply to the Notice of Appeal read:
7. In reassessing the Appellant for he 1994 taxation year, the Minister of National Revenue (the "Minister") reduced the Appellant's claim for farm losses by $24,958.42, from $27,208.42 to $2,250.00 as follows:
1994
|
|
Reported |
Adjustments |
Revised |
|
|
|
|
|
|
Gross Income |
|
|
|
|
Cattle Sales |
$55,053.06 |
$1,574.23 |
$56,627.29 |
|
GST Refund |
1,114.32 |
|
1,114.32 |
|
Feeder Calves |
4,240.00 |
|
4,240.00 |
|
MIA |
___________ |
53,938.80 |
53,938.80 |
|
Total Income |
$60,407.38 |
$55,513.03 |
$115,920.41 |
|
|
|
|
|
|
Expenses |
$102,700.78 |
$1,402.84 |
$104,103.62 |
|
MIA Included in Income in Prior Year |
___________ |
14,316.79 |
14,316.79 |
|
Total Deductions |
$102,700.78 |
$15,719.63 |
$118,420.41 |
|
Total Farm Loss |
($42,293.40) |
$39,793.40 |
($2,500.00) |
|
Less: Portion of Loss Allocated to Spouse |
___________ |
( 250.00) |
( 250.00) |
|
Net Farm Loss |
($42,293.40) |
$40,043.40 |
($2,250.00) |
|
Less: Portion of Farm Loss Carried Forward |
15,084.98 |
|
|
|
Net Farm Loss Claimed |
($27,208.42)* |
|
|
*Even though the Appellant calculated a farm loss in the amount of $42,293.40 on his statement of farm income and expenses for the 1994 taxation year, he only claimed the amount of $27,208.42, which was the amount of the loss necessary to reduce his income for the year to nil. He then carried forward the excess portion of the farm loss that he did not require to subsequent years.
8. In reassessing the Appellant for the 1995 taxation year, the Minister assessed net farm income in the amount of $5,764.00 and allowed a restricted farm loss carry forward in the amount of $5,764.00. The net farm income assessed for the year was determined as follows:
1995
|
|
Reported |
Adjustments |
Revised |
|
|
|
|
|
|
Gross Income |
|
|
|
|
Cattle Sales |
$93,038.26 |
$ 809.36 |
$93,847.62 |
|
Total Income |
$93,038.25 |
$ 809.36 |
$93,847.62 |
|
Expenses |
$37,948.76 |
($4,445.25) |
$33,503.51 |
|
MIA Included in Income in Prior Year |
___________ |
53,938.80 |
53,938.80 |
|
Total Deductions |
$37,948.76 |
$49,493.55 |
$87,442.31 |
|
Total Farm Income |
$55,089.50 |
$48,684.19 |
$6,405.31 |
|
Less: Portion of Loss Allocated to Spouse |
___________ |
( 640.48) |
( 640.48) |
|
Net Farm Income (Loss) |
$55,089.50 |
$49,324.67 |
$5,764.83 |
|
Add: Farm Loss Carried Forward from Prior Years |
(86,924.73)* |
|
|
|
Net Farm Loss |
($31,835.23) |
|
|
|
Less: Portion of Farm Loss Carry forward |
13,594.43* |
|
|
|
Net Farm Loss Claimed |
($18,240.80)* |
|
|
*In calculating his farm loss for the year, the Appellant included in his farm loss calculation his carry forward of accumulated farm losses from prior years. He then utilized these farm losses to the extent necessary to reduce his income for the year to nil and he then carried forward the excess portion of the losses that he did not require to subsequent years.
[3] With respect to the issues to be decided, the Court finds:
(a) The Appellant did not dispute the correctness of the Mandatory Inventory Adjustment calculation. Nor did he establish that any of the assumptions in paragraph 9 of the Reply were incorrect. In particular, he did not refute the calculation or the basis for the calculation in paragraphs 7 and 8 of the Reply.
(b) Finally, paragraph 111(1)(c) of the Income Tax Act ("Act") prevents the Appellant from carrying forward restricted farm losses against non-farm income.
[4] For these reasons, the appeals are dismissed.
Signed at Vancouver, Canada this 5th day of July, 1999.
|
"D.W. Beaubier" |
J.T.C.C.
COURT FILE NO.: 98-373(IT)I
STYLE OF CAUSE: Layton Bezan v. Her Majesty the Queen
PLACE OF HEARING: Regina, Saskatchewan
DATE OF HEARING: June 25, 1999
REASONS FOR JUDGMENT BY: The Honourable D.W. Beaubier
DATE OF JUDGMENT: July 5, 1999
APPEARANCES:
Counsel for the Appellant:
Counsel for the Respondent: Tracey Harwood-Jones
COUNSEL OF RECORD:
For the Appellant:
Name:
Firm:
For the Respondent: Morris Rosenberg
Deputy Attorney General of Canada
Ottawa, Canada