Miller v. M.N.R.
A-782-90
Mahoney J.A.
18/12/92
4 pp.
Respondent electing to forward average under Income Tax Act, s. 110.4(1) in 1982 -- Election claiming maximum deduction and deduction for $5,500 RRSP contribution -- Reported income supporting RRSP contribution of only $238 -- Minister refusing to increase amount elected to be forward averaged by $5,262 RRSP deduction disallowed -- S. 110.4(7) providing if amount deducted pursuant to election greater than amount deductible, deduction deemed to be reduced and taxable income for year increased accordingly -- No other provision authorizing election once made -- Tax Court holding since Minister's assessment resulting in greater amount being eligible, amendment of election merely matter of Minister completing assessment -- Trial Judge dismissing appeal -- Appeal allowed -- Taxpayer having option to forward average all, some or none of eligible amount -- No basis for allowing Minister, absent legislative authority, to impose choice on taxpayer, even if taxpayer considered it beneficial -- Minister had no power to amend forward averaging election for same reason powerless to reassess after expiration of limitation period even if taxpayer wanted reassessment, absent fraud, misrepresentation or timely waiver: Canadian Marconi Co. v. Canada, [1992] 1 F.C. 655 (C.A.) -- Finding Minister had such power would not be limited to particular taxpayer and could oblige other taxpayers to object to amendment of elections and perhaps to litigate -- Forward averaging election required to be made not later than date on which relevant tax return required to be filed and to be filed with return as no provision for late election -- Parliament clearly intended taxpayer to make election based on circumstances as existed, and as only he could know, at time filed return -- Act not contemplating election based on changed circumstances resulting from assessment or reassessment -- Income Tax Act, S.C. 1970-71-72, c. 63, ss. 110.4 (as enacted by S.C. 1980-81-82-83, c. 140, s. 69), 178(2) (as am. by S.C. 1976-77, c. 4, s. 64; 1980-81-82-83, c. 158, s. 58; 1984, c. 45, s. 75) -- Federal Court Rules, C.R.C., c. 663, R. 344 (as am. by SOR/87-221, s. 2).