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ADMINISTRATIVE LAW | SPPA / Fairness (Administrative)

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Federal Tax - Taxpayer Relief

. Belchetz v. Canada

In Belchetz v. Canada (Fed CA, 2020) the Federal Court of Appeal considered the 'taxpayer' relief provisions contained in subsection 220(3.1) of the ITA (here, granting interest relief on unpaid taxes):
[39] In determining whether to grant taxpayer relief pursuant to subsection 220(3.1) of the ITA, the Minister does not have a free hand to do whatever she wants, to act on a whim, or to unthinkingly rubber-stamp an earlier assessment: Canada v. Guindon, 2013 FCA 153 at paras. 57-58, aff’d 2015 SCC 41, without discussion of this issue. Courts can, moreover, intervene where a decision has been based on an erroneous finding of fact: Lalonde v. Canada (Revenue Agency), 2010 FC 531 at para. 32.

[40] All relevant considerations must be taken into account, and the decision in an administrative review must be based on the fairness purposes that lie behind subsection 220(3.1) of the ITA, as well as the purposes behind the ITA generally: Guindon (FCA), above at para. 58. The Minister’s discretion must also be genuinely exercised, and must not be fettered or dictated by policy statements such as Income Tax Information Circular IC 07-1R1: Stemijon Investments Ltd. v. Canada (Attorney General), 2011 FCA 299, 341 D.L.R. (4th) 710, at paras 25, 27.

[41] This latter principle is clearly spelled out in paragraph 24 of the Information Circular, which states that its provisions are guidelines only, and that they are not binding in law.


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