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Docket:2003-556(IT)I |
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BETWEEN: |
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ANTHONY MARK AKENA, |
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Appellant, |
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and |
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HER MAJESTY THE QUEEN,
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Respondent. |
____________________________________________________________________
Appeal heard on June 12, 2003 at Edmonton, Alberta
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Before: The Honourable Judge D.W. Beaubier |
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Appearances: |
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Agent for the Appellant: |
Frank Fedoruk |
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Counsel for the Respondent: |
Brooke Sittler |
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JUDGMENT
The appeal from the assessment made under the Income Tax Act for the 1998 taxation year is dismissed in accordance with the attached Reasons for Judgment.
Signed at Saskatoon, Saskatchewan, this 30th day of June 2003.
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"D.W. Beaubier" |
J.T.C.C.
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Citation:2003TCC416 |
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Date:20030630 |
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Docket:2003-556(IT)I |
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BETWEEN: |
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ANTHONY MARK AKENA, |
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Appellant, |
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and |
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HER MAJESTY THE QUEEN,
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Respondent. |
REASONS FOR JUDGMENT
Beaubier, J.T.C.C.
[1] This appeal pursuant to the Informal Procedure was heard at Edmonton, Alberta, on June 12, 2003. The Appellant was the only witness. He has a Ph D. in Chemistry.
[2] Paragraphs 1-13 of the Reply to the Notice of Appeal read as follows:
A. STATEMENT OF FACTS
1. He admits:
(a) that the Appellant filed a Notice of Objection in respect of the assessment issued by the Canada Customs and Revenue Agency (the "CCRA") for the 1998 taxation year;
(b) that the Appellant was arbitrarily assessed for the 1998 taxation year as he did not file a return of income for the year;
(c) that the Appellant did file an amended return of income for the 1998 taxation year on November 20, 2002; and
(d) that the amended return for the 1998 taxation year purports that the Appellant's taxable income was $3,003.00 and that the tax payable was nil
as stated in the Notice of Appeal.
2. He denies that the Appellant was assessed for the 1998 taxation year on April 26, 2002 as stated in the Notice of Appeal.
3. He states that there are no other allegations of fact stated in the Notice of Appeal to admit, deny or put in issue. However, if there are any other allegations of fact, they are denied.
4. By letter dated July 6, 1999 and sent to the Appellant on that date, the CCRA requested that the Appellant file a return of income for the 1998 taxation year.
5. By letter dated August 17, 1999 and sent to the Appellant on that date, the CCRA demanded that the Appellant file a return of income for the 1998 taxation year.
6. The Appellant did not file a return of income for the 1998 taxation year as requested and as demanded by the CCRA.
7. The Minister of National Revenue (the "Minister") assessed the Appellant on November 6, 2000 and further reassessed the Appellant on January 3, 2002 pursuant to subsection 152(7) of the Income Tax Act, R.S.C. 1985 (5th Supp.) c.1, (the "Act") as amended for the 1998 taxation year.
8. In assessing the Appellant as stated in paragraph 7 above, the Minister determined the Appellant's total income to be $18,783.00, as follows:
Source Amount
Royal Bank of Canada $ 2,000.00
Noramtec Consultants Inc. 1,003.00
Net Business Income 15,780.00
Total Income $18,783.00
9. In so assessing the Appellant, the Minister made the following assumptions of fact:
(a) the Appellant received the amount of $2,000.00 out of a registered retirement savings plan from the Royal Bank of Canada in the 1998 taxation year;
(b) the Appellant received the amount of $1,003.00 from Noramtec Consultants Inc. in the 1998 taxation year;
(c) at all material times to the 1998 taxation year, the Appellant was single;
(d) at all material times to the 1998 taxation year, the Appellant resided in the metropolitan area of Edmonton, Alberta;
(e) at all material times to the 1998 taxation year, the Appellant was self-employed as a chemist/consultant /
instructor/contract-worker;
(f) the Appellant did not provide to the CCRA any details with respect to the nature of his income earning activities for the 1998 taxation year;
(g) at all material times to the 1998 taxation year, the Appellant owned at least one motor vehicle;
(h) the Appellant paid rent in respect of personal accommodations in the amount of $492.00 per month, for a total of $5,904.00, in the 1998 taxation year;
(i) pursuant to statistics published by Statistics Canada, the average household expenditures in the metropolitan area of Edmonton, Alberta for a household with an average of 2.82 persons, excluding shelter, amounted to at least $30,664.00 for the 1998 year;
(j) based upon the statistics published by Statistics Canada as stated in paragraph 9(i) above, it is reasonable to conclude that the average household expenditures in the metropolitan area of Edmonton, Alberta for a household with one person, excluding shelter, amounted to at least $10,873.00 for the 1998 taxation year;
(k) it is reasonable to conclude that the personal expenses of the Appellant amounted to at least $16,777.00 for the 1998 taxation year, being the total of rent in the amount of $5,904.00 as stated in paragraph 9(h) above and other household expenses in the amount of $10,873.00 as stated in paragraph 9(j) above; and
(l) the Appellant was in receipt of net business income in the amount of at least $13,774.00 in the 1998 taxation year, being the difference between the Appellant's living expenses in the amount of $16,777.00 and the income totalling $3,003.00 as stated in paragraphs 9(a) and 9(b) above.
B. ISSUE TO BE DECIDED
10. The issue to be decided is whether the Minister properly assessed the Appellant pursuant to subsection 152(7) of the Act.
C. STATUTORY PROVISIONS, GROUNDS RELIED ON AND RELIEF SOUGHT
11. He relies on sections 3, 4, 9, 146, 161 and 162, subsection 152(7) and paragraphs 56(1)(h) and 150(1)(d) of the Act.
12. He submits that the Appellant was in receipt of net business income in the amount of at least $13,774.00 in the 1998 taxation year.
13. He further submits that the Appellant should be reassessed to reduce net business income by $2,006.00 from $15,780.00 to $13,774.00, and he requests that the remainder of the appeal be dismissed.
[3] The Appellant alleged that he finally filed an income tax return for 1998 in late 2002. When he testified he and his tax preparer, Mr. Fedoruk, failed to bring any back up documents respecting their allegations to Court. Mr. Akena also claimed medical problems in Court but again failed to be specific. His lack of specificity in all of his testimony, in total, amounted to evasiveness.
[4] In particular, the gist of his evidence is that his job as a chemist for the Province of Alberta terminated some years ago. He cannot get a recommendation for a job. As a result he has held a number of private coaching or tutoring jobs for students and an occasional consulting job in the last several years, including 1998.
[5] The Appellant admitted that he had the following income in 1998:
1. RRSP cashed in $2,000.00
2. Noramtec Consultants Inc. $1,003.00
3. Gross income business $7,798.30
Total $10,801.30
[6] Against his business income he claimed a business in-home expense concerning which he was not specific. In particular he did not describe the space used on that item used exclusively for business, nor did he describe the total area of the home. As a result this claim is not allowed. He also claimed vehicle expenses for his BMW but again he failed to be specific as to its business use, alleged customers or locations, or if it was all merely personal or home to work usage. Finally, he claimed a loss carry forward of $4,399.21 which, again he could not explain or particularize.
[7] As a result the Court finds that all of the claims against alleged business income are disallowed.
[8] None of the assumptions in paragraph 9 were refuted by the evidence.
[9] This Court is most reluctant to accept an estimation of income based solely on Statistics Canada figures. However, given the Appellant's own lack of credibility and failure to provide any credible verification of his allegations for 1998, the assumptions, as corrected in the Reply, are accepted.
[10] Therefore the appeal is dismissed.
Signed at Saskatoon, Saskatchewan, this 30th day of June 2003.
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"D.W. Beaubier" |
J.T.C.C.
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CITATION: |
2003TCC416 |
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COURT FILE NO.: |
2003-556(IT)I |
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STYLE OF CAUSE: |
Anthony Mark Akena and H.M.Q. |
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PLACE OF HEARING: |
Edmonton, Alberta |
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DATE OF HEARING: |
June 12, 2003 |
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REASONS FOR JUDGMENT BY: |
The Honourable Judge D.W. Beaubier |
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DATE OF JUDGMENT: |
June 30, 2003 |
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APPEARANCES: |
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Agent for the Appellant: |
Frank Fedoruk |
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Counsel for the Respondent: |
Brooke Sittler |
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COUNSEL OF RECORD: |
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For the Appellant: |
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Name: |
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Firm: |
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For the Respondent: |
Morris Rosenberg Deputy Attorney General of Canada Ottawa, Canada |