Practically every tax professional in the country has had to deal with the situation which arises when the Canada Revenue Agency (CRA) bases its reassessing position on the basis of an oral comment to the CRA. The difficulty is that there is no proof the comment was made or it may have been the result of a misunderstanding between the parties. In our practice we had one instance where a comment by an official of a charity to the CRA served as basis for reassessing over a thousand taxpayers. While the official admitted to having made the comment the fact was that the CRA auditor had misunderstood the context in which it was made.
Many of the cases I have reviewed in recent years on the question of whether a worker is an independent contractor or an employee have inevitably determined that the worker is an employee. While there are some notable exceptions to this trend, I find myself surprised whenever I read a decision that concludes that the worker is in fact an independent contractor. Therrien v Minister of National Revenue, 2013 TCC 116 is one such case.
The Federal Court of Appeal just decided that an accountant who received payments from a professional corporation he created did not properly create an arrangement that constituted a true employee profit-sharing plan. It was necessary for the professional corporation to make an election that payments would be based on profits; failing that, it was necessary for the professional corporation to have a set formula stating an amount to be computed by reference to profits so the employer was obligated to pay that amount to the trustees under the arrangement.