Tax Court of Canada


Income tax

Administration and enforcement

Language of Income Tax Act not allowing for family law or household expenses exception

Taxpayer had spouse’s employment paycheques electronically transferred to her bank account. Taxpayer’s spouse owed Minister outstanding debt, and it was during period of outstanding debt that spouse’s paycheques were transferred to taxpayer’s account. Minister assessed taxpayer as having liability due to paycheque transfers, as it was non-arm’s length transfer of property to taxpayer. Taxpayer appealed. Appeal dismissed. S. 160 (1) of Income Tax Act applied to comprehensive range of transfers, which included this transfer under wording “by any other means whatever”. Wording of section was strikingly broad, which was done to enable capture of even very circuitous routings in respect of property being moved from tax debtor transferor to non-arm’s length transferee. S. 160(1) of Act did not allow for family law or household expenses exception. Accordingly, appeal had to be denied.

Mottle v. The Queen (2018), 2018 CarswellNat 3177, 2018 CarswellNat 3408, 2018 TCC 116, 2018 CCI 116, B. Russell J. (T.C.C. [Informal Procedure]).

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