1999-3031(IT)I
BETWEEN:
NICOLA BONGIOVANNI,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
Appeal heard on September 15, 2000 at Toronto, Ontario, by
the Honourable Judge Terrence O'Connor
Appearances
For the Appellant: The Appellant himself
Counsel for the Respondent: Carol Aultman
JUDGMENT
The appeal from the reassessment made under the Income Tax Act for the 1997 taxation year is dismissed in accordance with the attached Reasons for Judgment.
Signed at Ottawa, Canada, this 24th day of October, 2000.
|
"T. O'Connor" |
J.T.C.C.
Date: 20001024
Docket: 1999-3031(IT)I
BETWEEN:
NICOLA BONGIOVANNI,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
REASONS FOR JUDGMENT
O'Connor, J.T.C.C.
[1] This appeal was heard at Toronto, Ontario on September 15, 2000. The Appellant ably represented himself.
ISSUE:
[2] The issue is whether an amount of $34,521 ("Amount") received by the Appellant as a disability award from the Workers' Compensation Board (the "WCB") in 1997 should be included in the calculation of total income and net income for that year or should it be pro-rated over the years upon which the Amount was based namely, in this case, the years 1992 through 1997. The negative effect of including the full Amount in the 1997 year is that under subsection 180.2(1) of the Income Tax Act ("Act") the Appellant was thus required to have his Old Age Security clawed-back. Another issue raised by the Appellant was since he had to pay approximately $6,500 (approximately $3,500 in legal fees and $3,000 in medical treatments and travel for that purpose) to be entitled to the award granted by the WCB, the Appellant should be entitled to deduct that $6,500 from the Amount.
FACTS:
[3] The relevant facts are as follows. In computing income for the 1997 taxation year the Appellant included the Amount in the calculation of total income and net income pursuant to paragraph 56(1)(v) of the Act and deducted the Amount in computing his taxable income under subparagraph 110(1)(f)(ii) of the Act.
[4] There is no doubt that the Amount was totally received in the 1997 taxation year and also there is no doubt that it relates to a period prior to 1997, namely the period from 1992 through 1997 (prior to 1992 WCB benefits did not have to be included in income). The Amount was compensation received under the worker's compensation law of the Province of Ontario in respect of an injury or disability.
SUBMISSIONS OF THE APPELLANT:
[5] The Appellant submits that it is only reasonable to pro-rate the Amount over the years 1992 to 1997 because it was in respect of all of those years that the Amount was calculated. He adds that, although this point was not urged upon the Court at the hearing, including the total amount in the 1997 year with the result that the claw-back provisions apply is contrary to the Canadian Charter of Rights and Freedoms ("Charter"). His final submission is that he should be entitled to deduct the amount of $6,500 as discussed above.
[6] Counsel for the Minister submits that the Minister properly assessed the Appellant for the 1997 taxation year in accordance with paragraphs 56(1)(v) and subparagraph 110(1)(f) of the Act. Counsel submits further that there should be no deduction for the $6,500 as the legal fees of $3,500, if incurred, are not deductible because they were not incurred for the purposes of collecting or establishing a right to collect wages or a pension (paragraphs 60(o) and 60(o.1) of the Act) nor for the purposes of producing income from a business or property (paragraph 8(1)(b) of the Act. Further the balance of $3,000 for medical treatments and travel to the medical facilities are not deductible in 1997. If they were deductible, they should have been deducted as medical expenses in the years incurred.
ANALYSIS AND DECISION:
[7] In Poulin and Her Majesty the Queen [1998] 3 C.T.C. 2820, Lamarre Proulx, T.C.J. faced the exact issues raised in this appeal and concluded that the Minister was correct. It is the date of the receipt of the WCB Amount that determines the taxation year in which it is to be included in income notwithstanding that the Amount may relate to prior years. She referred to two cases establishing that it is the date of receipt that is to determine in which year the income must be included. I am not bound by the decisions of other judges of this Court but it is clear that Lamarre Proulx, T.C.J. thoroughly considered the matter and I have no reason to differ from the conclusion that she reached.
[8] As to the Charter argument, the cases of Cardin v. Minister of National Revenue, 98 DTC 6195 and Lancey v. Her Majesty The Queen, 94 DTC 6075 (both decisions of the Federal Court of Appeal) considered the Charter issue in cases very similar to the present and concluded that the effect of the provisions in issue did not contravene the Charter. I find the same applies here.
[9] With respect to the Appellant's alternate position that he should be entitled to deduct $6,500, I believe the submissions of counsel for the Respondent are correct. The legal fees (approximately $3,500) are not deductible for the reasons set forth above and the medical expenses and related travel expenses could only have been deducted as medical expenses in the years incurred.
[10] In conclusion, for all of the above reasons, the appeal is dismissed.
Signed at Ottawa, Canada, this 24th day of October, 2000.
|
"T. O'Connor" |
J.T.C.C.
COURT FILE NO.: 1999-3031(IT)I
STYLE OF CAUSE: Nicola Bongiovanni v. The Queen
PLACE OF HEARING: Toronto, Ontario
DATE OF HEARING: September 15, 2000
REASONS FOR JUDGMENT BY: The Honourable Judge T. O'Connor
DATE OF JUDGMENT: October 24, 2000
APPEARANCES:
For the Appellant: The Appellant himself
Counsel for the Respondent: Carol Aultman
COUNSEL OF RECORD:
For the Appellant:
Name:
Firm:
For the Respondent: Morris Rosenberg
Deputy Attorney General of Canada
Ottawa, Canada