Paquet v. Canada (Attorney General)

Paquet v. Canada (Attorney General)
Court (s) Database
Federal Court Decisions
Date
2013-02-15
Neutral citation
2013 FC 158
File numbers
T-404-11
Decision Content
Date: 20130215
Docket: T-404-11
Citation: 2013 FC 158
[UNREVISED ENGLISH CERTIFIED TRANSLATION]
Ottawa, Ontario, February 15, 2013
PRESENT: The Honourable Mr. Justice Boivin
BETWEEN:
MARTINE PAQUET
Applicant
and
THE ATTORNEY GENERAL OF CANADA
Respondent
REASONS FOR JUDGMENT AND JUDGMENT
[1] This is an application for judicial review of a decision by the Canada Revenue Agency (the Agency) to refuse to credit the applicant for tax deducted at source. The decision was recommended by an Agency representative on April 14, 2009, and implemented through the applicant’s notice of assessment dated June 11, 2009. For the following reasons, the application for judicial review will be dismissed.
I. Factual background
[2] Martine Paquet (the applicant) allegedly worked for 3978834 Canada Inc. throughout 2006, performing the duties of a representative for a real estate development project. She alleges that she worked Monday to Sunday, inclusively, from noon to 5:00 p.m. and by appointment, selling family units in the project. The applicant was paid a gross weekly salary of $500 plus a 5.5% commission on sales, for a total employment income of $175,000.08 in 2006 (Applicant’s Record, p 20). The applicant states that the commissions and wages were paid irregularly but that the taxes payable were withheld. The applicant’s employer, 3978834 Canada Inc., allegedly withheld $33,592.08 in source deductions for the year 2006 (Applicant’s Record, Amended Detailed Affidavit of Martine Paquet, pp 13 and 20).
[3] The applicant submitted her 2006 income tax return in August 2008 (Respondent’s Record, p 28). The Agency’s computer system detected an anomaly in the income tax return filed by the applicant for the 2006 taxation year, specifically, the fact that the information appearing on the T4 slip issued by 3978834 Canada Inc. and enclosed with the applicant’s tax return did not appear in the Agency’s computer system. It was impossible to match up the information provided by the applicant and her employer. After the anomaly was detected, the applicant’s file was assigned to Francine Lamarche, a senior examiner at the Agency, on September 14, 2008. The examiner had to verify why the T4 slip submitted by the applicant for the 2006 taxation year was not in the Agency’s computer system and determine whether the Agency could rely on the information appearing on the slip in question (Respondent’s Record, Affidavit of Francine Lamarche, pp 1-2).
[4] The Agency’s computer system also revealed that the T4 slip filed by the applicant was not recorded under 3978834 Canada Inc.’s business number, whereas the T4 slips for other employees of the same company did appear in the computer system (Respondent’s Record, Exhibit B of the Affidavit of Francine Lamarche, p 16).
[5] When she reviewed the applicant’s file, the Agency examiner obtained the following information using the Agency’s computer system:
a. the applicant’s spouse was Gaston Therrien, the director of 3978834 Canada Inc. from 1998 to 2004;
b. the applicant reported that she was separated during the 2005 and 2006 taxation years;
c. 3978834 Canada Inc. did not issue any T4 information slips over $49,038 for the 2006 taxation year or for previous years;
d. the employee contributions to the Quebec Pension Plan (QPP) and the Quebec Parental Insurance Plan (QPIP) stated on the applicant’s T4 slip for 2006 were incorrect;
e. the most recent financial statements filed with the Agency by 3978834 Canada Inc. covered the period from February 1, 2003, to January 31, 2004;
f. the applicant did not work for 3978834 Canada Inc. in the taxation years prior to 2006.
(Respondent’s Record, Affidavit of Francine Lamarche, p 5)
[6] The Agency examiner was of the opinion that this information was insufficient to determine whether it was possible to rely on the information appearing on the T4 slip that the applicant had submitted with her tax return, particularly the deductions at source appearing on the T4 slip. On September 18, 2008, the Agency examiner sent the applicant a letter asking her to provide supporting information for the figures reported on her T4 slip, namely:
[translation]
a. the name of the payer;
b. the payer’s address and telephone number;
c. the dates during which she worked in this job in 2006;
d. copies of paystubs for 2006 or any other documentation that could substantiate the income tax deducted at source;
e. the duties she performed;
f. the number of people who were working for this employer in 2006.
(Respondent’s Record, Affidavit of Francine Lamarche, Exhibit E, pp 32-33)
[7] The applicant responded by a letter dated September 25, 2008, providing the following information:
[translation]
a. 3978834 Canada Inc.;
b. 454 St-Paul Street, Le Gardeur, Quebec, J5Z 4C7 (Tel.: 450‑582‑4811);
c. 2006;
d. See attached T4 and Relevé 1;
e. Representative;
f. Approximately five or six persons (It would be better if you asked the company yourself).
(Respondent’s Record, Affidavit de Francine Lamarche, Exhibit F, p 35)
[8] The Agency examiner found this information to be insufficient and therefore telephoned the applicant on September 29, 2008, and left her a message. When the applicant failed to return the call, the Agency examiner sent the applicant a second letter, dated November 4, 2008, asking for the name of the company’s owner, a copy of her paystubs for 2006, the payment method used by her employer, a copy of her Record of Employment and copies of banking transactions showing the deposits of her pay.
[9] By a letter dated November 27, 2008, the applicant stated that the company’s owner was Gaston Therrien, that she had been paid by cheque and that the copies of her paystubs, her Record of Employment and the banking transactions were unavailable. The Agency examiner was of the opinion that this information was still not enough to validate the fact that she had worked for the employer in question and that she had received wages from which deductions at source had been made.
[10] On December 2, 2008, the Agency examiner sent a round-trip memorandum to the Trust Accounts Compliance Section (the Section) to warn them that the T4 slip issued by 3978834 Canada Inc. for the applicant did not appear in the Agency’s computer system. According to the respondent, this memorandum was also sent so that the Section could perform other checks, if they were willing and able, concerning the T4 slip in question. The examiner also asked the Section to notify her if they decided to accept the information on the T4 slip. According to the Agency examiner, at that time, nothing was credited to the deduction at source account for 3978834 Canada Inc., meaning that there [translation] “was no money to cover the amounts on the [T4] issued by Ms. Paquet” (Applicant’s Record, Examination of Francine Lamarche, p 73).
[11] Since she still had not heard back from the Section, on April 14, 2009, the Agency examiner closed the applicant’s file in order to make the initial assessment for the 2006 taxation year. The Agency examiner allegedly recommended to the Confidence Validity Section that they not rely on the deductions on the applicant’s T4 slip because the deductions at source could not be validated. The Agency examiner sent the applicant a letter explaining this and notifying the applicant that if she provided documentation clearly showing that the deductions at source had been made, her return would be reassessed and possibly adjusted.
[12] On May 27, 2009, the Agency examiner had a telephone conversation with Gaston Therrien, 3978834 Canada Inc.’s president, who stated that he had sent the Agency information concerning the company’s employees, that the company’s remittances were not up to date and that the applicant worked as a sales and sales support representative. He told the Agency examiner that he would send the documents by fax, but he never did.
[13] It is alleged that it was through the respondent’s requests for supporting information that the applicant learned that her employer, 3978834 Canada Inc., had failed to remit to the authorities the sums supposedly deducted at source (Applicant’s Record, Amended Detailed Affidavit of Martine Paquet, p 13). It is further alleged that collection action was taken against 3978834 Canada Inc. to recover the sums deducted at source, sums that correspond to the amounts that the Agency is claiming from the applicant (Applicant’s Record, Amended Detailed Affidavit of Gaston Therrien, p 27).
[14] In his amended detailed affidavit, the president of 3978834 Canada Inc. filed the T4 slips for his twelve (12) employees for 2006, stating a total of more than $66,000 in deductions at source (Applicant’s Record, pp 36-41).
[15] An order of Prothonotary Morneau dated August 2, 2011, allowed the applicant to file a supplementary affidavit from the representative of 3978834 Canada Inc., as well as a report on the employer’s deductions and contributions, the T4 summary and the 2006 year-end report for 3978834 Canada Inc. The prothonotary found that the documents met the four (4) criteria set out in Atlantic Engraving Ltd v Lapointe Rosenstein, 2002 FCA 503, 299 NR 244. The same order also gave the applicant the opportunity to file a reply affidavit. In this supplementary affidavit, the representative of 3978834 Canada Inc. states that the company sent the T4 summary to the tax authorities at the end of February 2007 (Applicant’s Record, Supplementary Detailed Affidavit of Gaston Therrien, p 42 and Exhibit 3). He also provided a summary report on the employer’s deductions and contributions for all of the company’s employees, which report indicates a total of more than $66,000 in income tax deducted at source for the twelve (12) employees (Applicant’s Record, Supplementary Detailed Affidavit of Gaston Therrien, Exhibit 4, p 48). The representative of 3978834 Canada Inc. also stated that the applicant was the only employee whose T4 slip was not accepted by the tax authorities (Applicant’s Record, Supplementary Detailed Affidavit of Gaston Therrien, p 42).
II. Impugned decision
[16] The Agency refused to credit the applicant for deductions at source that had allegedly been made by her employer. This decision was implemented in the notice of assessment dated June 11, 2009 (Applicant’s Record, pp 6-8). The notice of assessment states that the applicant owes the sum of $45,063, which includes a penalty for late filing and interest on the arrears. The assessment summary states that the applicant’s taxable income is $175,000, with $39,305 in net federal tax payable and $0 in total tax deducted. The applicant is challenging the Agency’s decision to assess the total tax deducted as $0.
III. Issue
[17] This application for judicial review raises the following issue: Was the Agency’s decision not to credit the applicant for the amounts allegedly deducted from her pay in 2006 reasonable?
IV. Statutory provisions
[18] The provisions of the Income Tax Act, RSC 1985, c 1 (5th Supp) [the Act] and the Income Tax Regulations, CRC, c 945 [the Regulations] that are relevant to the present case are reproduced in an appendix to these reasons.
V. Standard of review
[19] The parties agree—and the Court concurs with their view—that this matter is a question of mixed fact and law and that the applicable standard of review would then be reasonableness (Dunsmuir v New Brunswick, 2008 SCC 9, [2008] 1 SCR 190 [Dunsmuir]).
[20] The Agency’s decision must therefore be reviewed on the standard of reasonableness. Accordingly, the Court will consider whether the decision falls with the range of possible, acceptable outcomes which are defensible in respect of the facts and law and whether the decision was justified, transparent and intelligible within the decision-making process (Dunsmuir, above at para 47).
VI. Arguments
A. The applicant
[21] The applicant argues that the Agency’s decision not to credit her for the sums allegedly deducted at source from her pay was unjustified in the circumstances. According to the applicant, she should not be punished for the employer’s filing failures that allegedly prevented the Agency from matching up the data in its computer system. The applicant is of the opinion that the inability to match up the data that the employer must file with the information that she provided should not result in her not being credited for the amounts deducted at source. The applicant further argues that her employer did indeed file the various federal and provincial forms for 2006, for each and every one of its employees.
[22] The applicant states that she answered the Agency’s requests for information to the best of her knowledge. According to the applicant, the respondent should have waited for an answer to the round-trip memorandum that had been sent to the Section. The applicant is of the opinion that the Section could have done more checks concerning the T4 slip issued in her case and that closing her file on April 14, 2009, without having received an answer from the Section.
[23] According to the applicant, the Agency representative should have checked with other employees of 3978834 Canada Inc. to verify that the applicant did indeed work there. The applicant argues that the Agency placed the onus on her to file documentation that 3978834 Canada Inc. should have provided, when it is up to the person who pays the wages to deduct the amounts assessed and make an information return in prescribed form (as stated in section 200 of the Regulations), and to file the return by a given date (section 205 of the Regulations).
[24] The applicant submits that the Agency did not perform the required checks that could have corroborated her statements. The applicant alleges that the Agency did not act with the rigour reasonably required in the circumstances when it refused to acknowledge the sums deducted from her pay. The applicant submits that it is up to the Department to apply the relevant legislation and recover from its agent, the employer (3978834 Canada Inc.), the amounts deducted but not remitted to the tax authorities. The applicant argues that she is entitled to the benefit of the amounts deducted from her pay, even if her employer failed to remit them to the Minister (citing Robert Lalonde v The Minister of National Revenue (1982), 82 DTC 1772 [available on QL] and Manke v Canada, [1998] TCJ No 759, 98 DTC 1969 [available on QL]).
[25] According to the applicant, the Agency erred in drawing a negative inference from the fact that she had previously been the spouse of the representative of 3978834 Canada Inc.; the fact that the employer had failed to file her T4 slips; the fact that, before 2006, none of the employer’s T4 slips was for more than $49,038; and the fact that the applicant did not work for 3978834 Canada Inc. before 2006. The applicant argues that she had nothing to gain in reporting a gross salary of $175,000 and claiming that deductions had been made at source, since that would have left her indebted to the tax authorities for an amount she allegedly did not receive.
B. The respondent
[26] The respondent is of the opinion that no deductions were made from the pay the applicant received from 3978834 Canada Inc., so she would not be entitled to a credit for income tax deducted at source. The respondent takes the position that the applicant did not submit any documentation or information proving that she worked for the employer and that she received a salary from which deductions at source were made.
[27] The respondent agrees with the applicant that if amounts were in fact deducted from her salary as income tax deducted at source during the 2006 taxation year, these amounts must be applied to reduce the tax payable for 2004, even if the employer, 3978834 Canada Inc. failed to remit these sums to the Agency (citing Canada v Mercantile Bank of Canada, [1980] FCJ No 254, [1981] 2 FC 169 [Mercantile Bank]; subsections 153(1) and 156.1(4) of the Act). However, if nothing was deducted at source, the applicant is not entitled to any credit for income tax withheld. An employer’s failure to deduct sums directly from an employee’s pay does not relieve the employee of his or her responsibility to pay his or her tax for the year (Mercantile Bank, above at para 45).
[28] According to the respondent, the decision to disregard the amount stated on the applicant’s T4 slip for deductions at source was reasonable. The respondent submits that the decision of April 14, 2009, implemented in the assessment dated June 11, 2009, was preceded by an analysis of internal Agency documents that could not confirm the salary deductions appearing on the T4 slip. The respondent notes that the Agency contacted the applicant twice in writing and once by telephone to ask her to submit supporting documentation for the alleged deductions, but it did not receive any documentation allowing it to confirm that she worked for 3978834 Canada Inc. and had received a salary from which deductions at source had been made.
[29] The respondent also submits that the Agency had no obligation to investigate 3978834 Canada Inc., as the applicant alleges, and that the Minister of National Revenue has a duty to make an assessment with all due dispatch (subsection 152(1) of the Act).
VII. Analysis
[30] First of all, regarding the affidavits of the president of 3978834 Canada Inc. and the other documents filed as exhibits with these affidavits, the respondent alleges that this evidence concerns new facts that were not before the decision maker and is therefore inadmissible in this application for judicial review, which must be limited to the record as it was before the decision maker. However, the Court notes that an order made by a prothonotary in respect of this case gave the applicant permission to file the supplementary affidavit of the president of 3978834 Canada Inc. as well as a summary T4 and a summary report on the employer’s deductions and contributions (Paquet c Canada, 2011 CF 972, [2011] ACF no 1184 (QL)). The Court is of the opinion that these documents are admissible, but only for the limited purpose of assessing the reasonableness of the Agency’s decision.
[31] The applicant had to show that these sums allegedly deducted at source from her salary were actually deducted, not that they were remitted to the Agency, which is up to her employer to prove. The Court is of the opinion that the documents that the Agency requested from the applicant were under her control and could have been filed (e.g., a bank statement showing the deposits of her pay). The evidence shows that the Agency did not ask the applicant to provide documents that she could not have in her possession. Nor did the Agency ask the applicant to provide documents that were the employer’s responsibility and of which she was unaware. The Court notes that the Agency contacted the applicant three (3) times to try to obtain the information. The Agency contacted the applicant by letter on September 18, 2008, and November 4, 2008, and determined that the replies to the two (2) written requests (September 26, 2008, and December 2, 2008) were inadequate. As regards the telephone request, the telephone message left by the Agency went unanswered.
[32] The taxation system is based on self-reporting and self-assessment, and the Court points out that the burden of proof is on the taxpayer, as stated by Justice Létourneau of the Federal Court of Appeal in Voitures Orly Inc v Canada, 2005 FCA 425 at para 20, [2005] FCJ No 2116 (QL):
[20] To sum up, we see no merit in the submissions of the appellant that it no longer had the burden of disproving the assumptions made by the Minister. We want to firmly and strongly reassert the principle that the burden of proof put on the taxpayer is not to be lightly, capriciously or casually shifted. There is a very simple and pragmatic reason going back to over 80 years ago as to why the burden is on the taxpayer: see Anderson Logging Co. v. British Columbia, [1925] S.C.R. 45, Pollock v. Canada (Minister of National Revenue) (1993), 161 N.R. 232 (F.C.A.), Vacation Villas of Collingwood Inc. v. Canada (1996), 133 D.L.R. (4th) 374 (F.C.A.), Anchor Pointe Energy Ltd. v. Canada, 2003 FCA 294. It is the taxpayer’s business. He knows how and why it is run in a particular fashion rather than in some other ways. He knows and possesses information that the Minister does not. He has information within his reach and under his control. The taxation system is a self-reporting system. Any shifting of the taxpayer’s burden to provide and to report information that he knows or controls can compromise the integrity, enforceability and, therefore, the credibility of the system. That being said, we recognize that there are instances where the shifting of the burden may be warranted. This is simply not one of those cases.
[Emphasis added.]
[33] Moreover, the Court cannot agree with the applicant’s submission that the inability of the Agency’s computer system to match her T4 slip with information that her employer should have provided is the reason for refusing to credit her for the deductions at source. This inability to match the data, which is an anomaly, triggered an examination of the applicant’s file. The applicant could have put this examination to rest by filing documents proving that a deduction at source had been made in her case. In light of the record, which contains no evidence to this effect, it was not unreasonable for the Agency to conclude as it did.
[34] The Court agrees with the respondents arguments to the effect that the burden of proof is on the applicant and that the Agency has no obligation to investigate a third party to confirm the claims of a taxpayer, as the applicant submitted. The Court refers to the remarks of Justice Létourneau of the Federal Court of Appeal in Canada v Landry, 2010 FCA 135 at para 37, [2010] FCJ No 662 (QL):
[37] Even though the judge recognized in his reasons that the respondent has the obligation to rebut the Minister’s assumptions, it is surprising to see that he created an obligation on the part of the Agency to conduct investigations into third parties to corroborate or try to disprove the respondent’s statements. Taxpayers are the ones who have information on their affairs, and it is up to them to provide it and discharge their burden of proof, especially in cases of net worth assessments. Contrary to what the judge wrote, it was not up to the auditor to provide a “possible explanation as to the sources of the [respondent’s] income” . . . .
[Emphasis added.]
[35] The applicant also criticizes the Agency for closing her file prematurely, that is, before receiving a reply to the round-trip memorandum sent to the Section. However, the decision to close the applicant’s file for the 2006 taxation year came after April 14, 2009, that is, more than two (2) years after the end of the taxation year and five (5) months after the first contacts with the applicant. The Court also notes that the Agency’s decision shows that the Agency was still willing to make a reassessment if the applicant sent in documentation (Respondent’s Record, pp 45-46).
[36] Therefore, in light of the numerous requests that the Agency made to the applicant, and the fact that the burden of proof is on the taxpayer, the Agency’s decision to close the applicant’s file so that it could make an assessment in a timely manner was not only reasonable in the circumstances, but also complied with the obligation of the Minister, acting through the Agency, to examine taxpayers’ returns with all due dispatch (subsection 152(1) of the Act). Finally, the argument concerning the search of the company, raised by the applicant at the hearing, did not persuade this Court.
[37] The Court is of the opinion that the Agency’s decision falls within the range of possible, acceptable outcomes which are defensible in respect of the facts and law (Dunsmuir, above; Newfoundland and Labrador Nurses’ Union v Newfoundland and Labrador (Treasury Board), 2011 SCC 62, [2011] 3 SCR 708; Smith v Alliance Pipeline Ltd, 2011 SCC 7, [2011] 1 SCR 160; Construction Labour Relations v Driver Iron Inc., 2012 SCC 65, [2012] SCJ No 65 (QL)). The intervention of this Court is unwarranted.
JUDGMENT
THE COURT ORDERS AND ADJUDGES that the application for judicial review be dismissed, with costs.
“Richard Boivin”
Judge
Certified true translation
Michael Palles
Appendix
The following provisions of the Income Tax Act are relevant to this application for judicial review:
Division I
Returns, Assessments, Payment and Appeals
…
Assessment
Assessment
152. (1) The Minister shall, with all due dispatch, examine a taxpayer’s return of income for a taxation year, assess the tax for the year, the interest and penalties, if any, payable and determine
(a) the amount of refund, if any, to which the taxpayer may be entitled by virtue of section 129, 131, 132 or 133 for the year; or
(b) the amount of tax, if any, deemed by subsection 120(2) or (2.2), 122.5(3), 122.51(2), 122.7(2) or (3), 125.4(3), 125.5(3), 127.1(1), 127.41(3) or 210.2(3) or (4) to be paid on account of the taxpayer’s tax payable under this Part for the year.
…
Payment of Tax
Withholding
153. (1) Every person paying at any time in a taxation year
(a) salary, wages or other remuneration, other than amounts described in subsection 115(2.3) or 212(5.1),
…
shall deduct or withhold from the payment the amount determined in accordance with prescribed rules and shall, at the prescribed time, remit that amount to the Receiver General on account of the payee’s tax for the year under this Part or Part XI.3, as the case may be, and, where at that prescribed time the person is a prescribed person, the remittance shall be made to the account of the Receiver General at a designated financial institution.
…
Payment of remainder
156.1 (4) Every individual shall, on or before the individual’s balance-due day for each taxation year, pay to the Receiver General in respect of the year the amount, if any, by which the individual’s tax payable under this Part for the year exceeds the total of
(a) all amounts deducted or withheld under section 153 from remuneration or other payments received by the individual in the year, and
(b) all other amounts paid to the Receiver General on or before that day on account of the individual’s tax payable under this Part for the year.
…
PART XV
ADMINISTRATION AND ENFORCEMENT
…
Collection
…
Withholding taxes
227. (1) No action lies against any person for deducting or withholding any sum of money in compliance or intended compliance with this Act.
Return filed with person withholding
(2) Where a person (in this subsection referred to as the “payer”) is required by regulations made under subsection 153(1) to deduct or withhold from a payment to another person an amount on account of that other person’s tax for the year, that other person shall, from time to time as prescribed, file a return with the payer in prescribed form.
Failure to file return
(3) Every person who fails to file a return as required by subsection (2) is liable to have the deduction or withholding under section 153 on account of the person’s tax made as though the person were a person who is neither married nor in a common-law partnership and is without dependants.
Trust for moneys deducted
(4) Every person who deducts or withholds an amount under this Act is deemed, notwithstanding any security interest (as defined in subsection 224(1.3)) in the amount so deducted or withheld, to hold the amount separate and apart from the property of the person and from property held by any secured creditor (as defined in subsection 224(1.3)) of that person that but for the security interest would be property of the person, in trust for Her Majesty and for payment to Her Majesty in the manner and at the time provided under this Act.
Extension of trust
(4.1) Notwithstanding any other provision of this Act, the Bankruptcy and Insolvency Act (except sections 81.1 and 81.2 of that Act), any other enactment of Canada, any enactment of a province or any other law, where at any time an amount deemed by subsection 227(4) to be held by a person in trust for Her Majesty is not paid to Her Majesty in the manner and at the time provided under this Act, property of the person and property held by any secured creditor (as defined in subsection 224(1.3)) of that person that but for a security interest (as defined in subsection 224(1.3)) would be property of the person, equal in value to the amount so deemed to be held in trust is deemed
(a) to be held, from the time the amount was deducted or withheld by the person, separate and apart from the property of the person, in trust for Her Majesty whether or not the property is subject to such a security interest, and
(b) to form no part of the estate or property of the person from the time the amount was so deducted or withheld, whether or not the property has in fact been kept separate and apart from the estate or property of the person and whether or not the property is subject to such a security interest
and is property beneficially owned by Her Majesty notwithstanding any security interest in such property and in the proceeds thereof, and the proceeds of such property shall be paid to the Receiver General in priority to all such security interests.
…
Penalty
(8) Subject to subsection 227(8.5), every person who in a calendar year has failed to deduct or withhold any amount as required by subsection 153(1) or section 215 is liable to a penalty of
(a) 10% of the amount that should have been deducted or withheld; or
(b) where at the time of the failure a penalty under this subsection was payable by the person in respect of an amount that should have been deducted or withheld during the year and the failure was made knowingly or under circumstances amounting to gross negligence, 20% of that amount.
Joint and several liability
(8.1) Where a particular person has failed to deduct or withhold an amount as required under subsection 153(1) or section 215 in respect of an amount that has been paid to a non-resident person, the non-resident person is jointly and severally liable with the particular person to pay any interest payable by the particular person pursuant to subsection 227(8.3) in respect thereof.
…
Interest on amounts not deducted or withheld
(8.3) A person who fails to deduct or withhold any amount as required by subsection 135(3), 135.1(7), 153(1) or 211.8(2) or section 215 shall pay to the Receiver General interest on the amount at the prescribed rate, computed
(a) in the case of an amount required by subsection 153(1) to be deducted or withheld from a payment to another person, from the fifteenth day of the month immediately following the month in which the amount was required to be deducted or withheld, or from such earlier day as may be prescribed for the purposes of subsection 153(1), to,
(i) where that other person is not resident in Canada, the day of payment of the amount to the Receiver General, and
(ii) where that other person is resident in Canada, the earlier of the day of payment of the amount to the Receiver General and April 30 of the year immediately following the year in which the amount was required to be deducted or withheld;
(b) in the case of an amount required by subsection 135(3) or 135.1(7) or section 215 to be deducted or withheld, from the day on which the amount was required to be deducted or withheld to the day of payment of the amount to the Receiver General; and
(c) in the case of an amount required by subsection 211.8(2) to be withheld, from the day on or before which the amount was required to be remitted to the Receiver General to the day of the payment of the amount to the Receiver General.
Liability to pay amount not deducted or withheld
(8.4) A person who fails to deduct or withhold any amount as required under subsection 135(3) or 135.1(7) in respect of a payment made to another person or under subsection 153(1) in respect of an amount paid to another person who is non-resident or who is resident in Canada solely because of paragraph 250(1)(a) is liable to pay as tax under this Act on behalf of the other person the whole of the amount that should have been so deducted or withheld and is entitled to deduct or withhold from any amount paid or credited by the person to the other person or otherwise to recover from the other person any amount paid by the person as tax under this Part on behalf of the other person.
(8.5) [Repealed, 1994, c. 7, Sch. VIII, s. 132(2)]
Penalty
(9) Subject to subsection 227(9.5), every person who in a calendar year has failed to remit or pay as and when required by this Act or a regulation an amount deducted or withheld as required by this Act or a regulation or an amount of tax that the person is, by section 116 or by a regulation made under subsection 215(4), required to pay is liable to a penalty of
(a) subject to paragraph (b), if
(i) the Receiver General receives that amount on or before the day it was due, but that amount is not paid in the manner required, 3% of that amount,
(ii) the Receiver General receives that amount
(A) no more than three days after it was due, 3% of that amount,
(B) more than three days and no more than five days after it was due, 5% of that amount, or
(C) more than five days and no more than seven days after it was due, 7% of that amount, or
(iii) that amount is not paid or remitted on or before the seventh day after it was due, 10% of that amount; or
(b) where at the time of the failure a penalty under this subsection was payable by the person in respect of an amount that should have been remitted or paid during the year and the failure was made knowingly or under circumstances amounting to gross negligence, 20% of that amount.
Penalty
(9.1) Notwithstanding any other provision of this Act, any other enactment of Canada, any enactment of a province or any other law, the penalty for failure to remit an amount required to be remitted by a person on or before a prescribed date under subsection 153(1), subsection 21(1) of the Canada Pension Plan, subsection 53(1) of the Unemployment Insurance Act and subsection 82(1) of the Employment Insurance Act shall, unless the person who is required to remit the amount has, knowingly or under circumstances amounting to gross negligence, delayed in remitting the amount or has, knowingly or under circumstances amounting to gross negligence, remitted an amount less than the amount required, apply only to the amount by which the total of all so required to be remitted on or before that date exceeds $500.
Interest on amounts deducted or withheld but not remitted
(9.2) Where a person has failed to remit as and when required by this Act or a regulation an amount deducted or withheld as required by this Act or a regulation, the person shall pay to the Receiver General interest on the amount at the prescribed rate computed from the day on which the person was so required to remit the amount to the day of remittance of the amount to the Receiver General.
Interest on certain tax not paid
(9.3) Where a person fails to pay an amount of tax that, because of section 116, subsection 212(19) or a regulation made under subsection 215(4), the person is required to pay, as and when the person is required to pay it, the person shall pay to the Receiver General interest on the amount at the prescribed rate computed from the day on or before which the amount was required to be paid to the day of payment of the amount to the Receiver General.
Liability to pay amount not remitted
(9.4) A person who has failed to remit as and when required by this Act or a regulation an amount deducted or withheld from a payment to another person as required by this Act or a regulation is liable to pay as tax under this Act on behalf of the other person the amount so deducted or withheld.
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Minister’s receipt discharges debtor
(13) The receipt of the Minister for an amount deducted or withheld by any person as required by or under this Act is a good and sufficient discharge of the liability of any debtor to the debtor’s creditor with respect thereto to the extent of the amount referred to in the receipt.
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Liability of directors for failure to deduct
227.1 (1) Where a corporation has failed to deduct or withhold an amount as required by subsection 135(3) or 135.1(7) or section 153 or 215, has failed to remit such an amount or has failed to pay an amount of tax for a taxation year as required under Part VII or VIII, the directors of the corporation at the time the corporation was required to deduct, withhold, remit or pay the amount are jointly and severally, or solidarily, liable, together with the corporation, to pay that amount and any interest or penalties relating to it.
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Section I
Déclarations, cotisations, paiement et appels
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Cotisation
Cotisation
152. (1) Le ministre, avec diligence, examine la déclaration de revenu d’un contribuable pour une année d’imposition, fixe l’impôt pour l’année, ainsi que les intérêts et les pénalités éventuels payables et détermine :
a) le montant du remboursement éventuel auquel il a droit en vertu des articles 129, 131, 132 ou 133, pour l’année;
b) le montant d’impôt qui est réputé, par les paragraphes 120(2) ou (2.2), 122.5(3), 122.51(2), 122.7(2) ou (3), 125.4(3), 125.5(3), 127.1(1), 127.41(3) ou 210.2(3) ou (4), avoir été payé au titre de l’impôt payable par le contribuable en vertu de la présente partie pour l’année.
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Paiement de l’impôt
Retenue
153. (1) Toute personne qui verse au cours d’une année d’imposition l’un des montants suivants :
a) un traitement, un salaire ou autre rémunération, à l’exception des sommes visées aux paragraphes 115(2.3) ou 212(5.1);
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doit en déduire ou en retenir la somme fixée selon les modalités réglementaires et doit, au moment fixé par règlement, remettre cette somme au receveur général au titre de l’impôt du bénéficiaire ou du dépositaire pour l’année en vertu de la présente partie ou de la partie XI.3. Toutefois, lorsque la personne est visée par règlement à ce moment, la somme est versée au compte du receveur général dans une institution financière désignée.
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Paiement du solde
156.1 (4) Tout particulier doit payer au receveur général pour chaque année d’imposition, au plus tard à la date d’exigibilité du solde qui lui est applicable pour l’année, l’excédent éventuel de l’impôt dont il est redevable en vertu de la présente partie sur le total des montants suivants :
a) les montants déduits ou retenus en application de l’article 153 de la rémunération ou d’autres paiements reçus par le particulier au cours de l’année;
b) les autres montants payés au receveur général au plus tard à cette date au titre de l’impôt payable par le particulier en vertu de la présente partie pour l’année.
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PARTIE XV
APPLICATION ET EXÉCUTION
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Recouvrement
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Retenue des impôts
227. (1) Nulle action ne peut être intentée contre une personne pour le fait de déduire ou de retenir une somme d’argent quelconque en conformité, réelle ou intentionnelle, avec la présente loi.
Déclaration à produire auprès de la personne qui fait les retenues
(2) Lorsqu’une personne (appelée le « payeur » au présent paragraphe) est tenue en vertu des dispositions réglementaires prises en application du paragraphe 153(1) de déduire d’un paiement à une autre personne ou de retenir sur un tel paiement un montant au titre de l’impôt de cette autre personne pour l’année, cette autre personne doit, selon les modalités de temps fixées par ces dispositions, produire auprès du payeur une déclaration selon le formulaire prescrit.
Défaut de produire la déclaration
(3) Toute personne qui omet de produire un formulaire, ainsi que le requiert le paragraphe (2), est susceptible de subir la déduction ou