Two Lawyers from KSW Recognized as Leaders in Employment & Family Law
CONTACT
PAY BILL
LINKEDIN
CONTACT
PAY BILL
LINKEDIN
CONTACT
PAY BILL
LINKEDIN
Home
> Lawyer Content
> Blog title on how to fine the perfect lawyer
Link To Youtube
Recent Media
Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.
Contact Us

A Note on Reassessments Beyond the Normal Reassessment Period

May 21, 2024

A Note on Reassessments Beyond the Normal Reassessment Period

No items found.

As agreed by the Court, “the [Act] itself is a difficult one, and … the precise interpretation of section 152(4) is in the upper limits of those difficulties.”

Limitation periods … are meant to promote certainty, avoid stale evidence, encourage diligence, and bring repose: see M(K) v M(H), [1992] 3 SCR 6.

… The certainty rationale recognizes that, with the passage of time, an individual “should be secure in his reasonable expectation that he will not be held to account for ancient obligations”: M(K), supra. The evidentiary rational recognizes the desire to preclude claims where the evidence used to support that claim has grown stale. The diligence rational encourages claimants “to act diligently and not “sleep on their rights”“: M(K), supra.

In order for the Minster to reassess beyond the normal reassessment period, the Minister has the burden of proving, on a balance of probabilities, that the taxpayer has committed a fraud or has made a misrepresentation attributable to neglect, carelessness, or wilful default in the filing of the return.

The burden on the Minister when reassessing outside the normal limitation period is quite unlike where the Minister reassesses a taxpayer within the normal reassessment period, and may rely on a simple assumption of facts, with the onus being on the taxpayer to demolish the ministerial assumptions. Where the Minister is reassessing beyond the normal reassessment period, the Minister must prove:

- that a misrepresentation has been made by the taxpayer;

- that the misrepresentation is attributable to neglect, carelessness, or wilful default.

At the risk of redundancy, it is important to recognize that where the taxpayer has not committed fraud, a statute barred year may only be opened up for reassessment where the misrepresentation said to have been made is attributable to neglect, carelessness, or wilful default.

Moreover, the Minister must satisfy this burden of proof for each item the Minister reassessed outside the normal reassessment period, and may not rely upon its assumptions in the course of doing the same.

Where a taxpayer’s filing position is bona fide and reasonable, to the extent a taxpayer may have made an error or mistake in the Minister’s view, the Court has agreed the taxpayer has not made the type of misrepresentation that would justify the opening up of years that are statute barred. Put another way, the Minister disagreeing with the taxpayer’s filing position is not enough to justify a reassessment beyond the normal reassessment period.

Moreover, where an error committed by a taxpayer is one which a normally wise and cautious taxpayer could have committed, and the court is not persuaded that error involved negligence on the part of the taxpayer, the Minister may still be barred from reassessing beyond the normal reassessment period.

Before the court can consider whether an assessment is correct it must first decide that it was validly made. … It is essential that before the court hears evidence on the correctness of the assessment it be satisfied that the Minister had the right to assess at all … Until the validity of the assessment that is otherwise statute-barred is established by the Minister … the taxpayer’s only onus is to show that the reassessment was made outside the normal reassessment period.

Once the Minister has established that the reassessment beyond the normal reassessment period is proper, then the burden of proof shifts to the taxpayer as to whether the return was rightly filed.

Tags
No items found.

Lawyer

Fayme K. Hodal

Fayme K Hodal and her team assist clients with all Employment law matters, including wrongful and constructive dismissals, dismissals for cause, executive compensation and buy-outs, and negotiation of severance packages.

Fayme has extensive experience working with individual, business and corporate clients throughout British Columbia and Alberta. She regularly advises on civil disputes of all varieties and prepares coverage opinions relating to private insurance disputes.

Fayme also assists clients with privacy law and defamation questions.

Fayme is a life-long West Coast local; she obtained her...

Profile
You may also be interested in...

Contact

Have questions? Need insight? Our team can assist you in examining your options and determining which path best suits your needs.

Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.

*By clicking submit you agree you have read our Privacy Policy and Disclaimer
Disclaimer: the information you obtain at this site is not, nor is it intended to be, legal advice. We invite you to contact us and welcome your calls, letters and electronic mail. Contacting us does not create a lawyer-client relationship. Please do not send any confidential information to us until such time as a lawyer-client relationship has been established. By checking this box you agree to receive communications from KSW Lawyers, which may include quarterly email Newsletters containing legal updates (may easily unsubscribe at any time).