Combot v. The Queen

Combot v. The Queen
Court (s) Database
Tax Court of Canada Judgments
Date
2005-08-08
Neutral citation
2005 TCC 490
File numbers
2004-3653(IT)I
Judges and Taxing Officers
Leslie M. Little
Subjects
Income Tax Act
Decision Content
Docket: 2004-3653(IT)I
BETWEEN:
LUCILLE COMBOT,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
____________________________________________________________________
Appeal heard on common evidence with the appeal of Denis Combot (2004-3654(IT)I) on July 18, 2005 at Winnipeg, Manitoba
Before: The Honourable Justice L.M. Little
Appearances:
Agent for the Appellant:
Gayle Andrews
Counsel for the Respondent:
Tracey Telford
____________________________________________________________________
JUDGMENT
The appeal from the assessment made under the Income Tax Act for the 2000 taxation year is dismissed, without costs in accordance with the attached Reasons for Judgment.
Signed at Vancouver, British Columbia, this 8th day of August 2005.
"L.M. Little"
Little J.
Docket: 2004-3654(IT)I
BETWEEN:
DENIS COMBOT,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
____________________________________________________________________
Appeal heard on common evidence with the appeal of Lucille Combot (2004-3653(IT)I) on July 18, 2005 at Winnipeg, Manitoba
Before: The Honourable Justice L.M. Little
Appearances:
Agent for the Appellant:
Gayle Andrews
Counsel for the Respondent:
Tracey Telford
____________________________________________________________________
JUDGMENT
The appeal from the assessment made under the Income Tax Act for the 2000 taxation year is dismissed, without costs, in accordance with the attached Reasons for Judgment.
Signed at Vancouver, British Columbia, this 8th day of August 2005.
"L.M. Little"
Little J.
Citation: 2005TCC490
Date:20050808
Dockets: 2004-3653(IT)I
2004-3654(IT)I
BETWEEN:
LUCILLE COMBOT,
DENIS COMBOT,
Appellants,
and
HER MAJESTY THE QUEEN,
Respondent.
REASONS FOR JUDGMENT
Little J.
A. FACTS:
[1] The Appellants carried on a carpentry construction business as a Partnership in the Province of Manitoba. The Partnership was operated under the name of F.M. Combot and Sons.
[2] The Appellants had the following interest in the Partnership:
Lucille Combot 20%
Denis Combot 80%
[3] On July 23, 1999, Denis Combat provided Mr. and Mrs. St. Goddard with a Job Estimate in which he indicated that he would construct their home for a price of $97,476.20. (Exhibit A-1)
[4] On November 18, 1999, Denis Combat provided Mr. and Mrs. St. Goddard with a second Job Estimate in which he stated that because of certain changes to the Building Plan he amended the Job Estimate to construct their home for a price of $105,279.18. (Exhibit A-2)
[5] Denis Combat testified that he commenced to construct the home for the St. Goddards in November 1999.
[6] The Minister of National Revenue (the "Minister") takes the position that the amount of $91,990.02 ($85,971.99 plus G.S.T. of $6,018.03) was earned by the Partnership in the Appellants' 2000 taxation year.
[7] The Minister maintains that the amount of $57,400.10 ($53,644.96 plus G.S.T. of $3,755.14) was recorded in the Appellants' books in the 2000 taxation year.
[8] The Minister maintains that the Appellants did not report the amount of $34,589.92 ($32,327.03 plus G.S.T. of $2,262.89) in the Appellants' books for the 2000 taxation year or for any other taxation year. The Minister maintains that the amount of $32,327.03 represents unreported income received by the Appellants from Mr. and Mrs. St. Goddard regarding the construction of their home.
[9] The Notices of Reassessment issued by the Minister have included the following amounts as unreported income for the 2000 taxation year of the Appellants:
Unreported Income
Lucille Combot $ 6,465.41 ($32,327.03 x 20%)
Denis Combot $25,861.62 ($32,327.03 x 80%)
B. ISSUE:
[10] The issue is whether the Appellants failed to report their share of the amount of $32,327.03 in their income for the 2000 taxation year.
C. ANALYSIS AND CONCLUSION:
[11] The Appellant, Lucille Combot, testified that she prepared the books and records for the Partnership and she then gave the books and records to the bookkeeper who prepared the income tax returns for the Appellants.
[12] Lucille Combot also testified that she has no training as a bookkeeper, has no knowledge of accounting and has never personally prepared an income tax return. She said that she simply records the money that is received by the Partnership from its customers and deposits the money in a bank account.
[13] Gayle Andrews, the agent for the Appellants, argued that the amount of $32,327.03 was the income earned by the Appellants in the 1999 taxation year. Ms. Andrews maintained that since the 1999 taxation year was statute barred there is no basis for including the amount of $32,327.03 in the 2000 taxation year since the Appellants operate on an accrual basis.
[14] I am not satisfied on the evidence that was presented that the Appellants operate their business on an accrual basis.
[15] I am also not satisfied on the evidence that was presented that the Appellants reported the income earned from the contract with the St. Goddards in determining their income for the 1999 taxation year.
[16] Since the Appellants have not discharged the onus of establishing that the reassessments were incorrect, the appeals are dismissed, without costs.
Signed at Vancouver, British Columbia, this 8th day of August 2005.
"L.M. Little"
Little J.
CITATION:
2005TCC490
COURT FILE NOS.:
2004-3653(IT)I,
2004-3654(IT)I
STYLE OF CAUSE:
Lucille Combot,
Denis Combot and
Her Majesty the Queen
PLACE OF HEARING:
Winnipeg, Manitoba
DATE OF HEARING:
July 18, 2005
REASONS FOR JUDGMENT BY:
The Honourable Justice L.M. Little
DATE OF JUDGMENT:
August 8, 2005
APPEARANCES:
Agent for the Appellant:
Gayle Andrews
Counsel for the Respondent:
Tracey Telford
COUNSEL OF RECORD:
For the Appellant:
Name:
Firm:
For the Respondent:
John H. Sims, Q.C.
Deputy Attorney General of Canada
Ottawa, Canada