Bill C-60: Changes to the Tax Court Rules

In the first article of our Bill C-60 series in our May 22 issue of KBR, we looked at the proposed amending of the audit process. This week we examine the changes to the tax court rules.

On April 29, the Minister of Finance, Jim Flaherty, introduced Bill C-60 to Parliament which proposes to implement certain provisions of the March 21, 2013 federal budget; among these, proposed legislative amendments that pertain to provisions in the Tax Court of Canada Rules regarding the General Procedure, discussed below, in the second of a four-part series.

Part 2 – Changes to the Tax Court Rules

There are two procedures that taxpayers may follow when appealing a reassessment, the General Procedure and the Informal Procedure. The General Procedure follows the rules regarding the admissibility of evidence, allows parties to examine the other side through the discovery process, and proceeds to trial if no settlement can be reached. The Informal Procedure is a process whereby written submissions are given to the court for consideration, the formal rules of evidence do not apply, and a hearing must be set down within a year of the receipt of the pleadings.

Currently, in order to access the Informal Procedure, the "aggregate of all amounts in issue" in appeals under the Act must be $12,000 or less, or the amount of loss determined under subsection 152(1.1) of the Act must be $24,000 or less. The "aggregate of all amounts" is defined to be the total of all amounts assessed or determined by the Minister of National Revenue under the Act, but does not include interest or any amount of loss.

Bill C-60 proposes to increase the limits of the Informal Procedure within the Tax Court of Canada Act  (the Tax Court Act) to $25,000 or $50,000 of loss determined under subsection 152(1.1) of the Act.

Next time: Part 3 – Changes to the Discovery Process