Federal Appeal


Income tax

Tax credits

Prescribed information included information necessary to determine whether activity qualified as Scientific Research and Experimental Development

Taxpayer filed amended tax return for 2011 taxation year to report Scientific Research and Experimental Development (SRED) expenditures for two projects and to claim corresponding refundable investment tax credit amounts. On Schedule 60 of Form T661, taxpayer provided project information in boxes 240, 242 and 244 only for second project and not for first one. Minister of National Revenue reassessed taxpayer under Income Tax Act, granting tax credit for second project but not for first project. Taxpayer’s appeal was dismissed. Tax Court judge concluded that prescribed form filed by taxpayer did not contain all prescribed information that was required because no information was provided in three boxes on form. Judge determined that missing information was important to verify claim because it addressed key legislative requirements for SRED, being technological advancement, technological uncertainty, and systematic investigation. Taxpayer appealed. Appeal dismissed. Legislation was clear that prescribed information included information necessary to determine whether activity qualified as SRED. This interpretation was consistent with administrative policy statements. Information that was missing from form was required to be included on form, even if Minister was already in possession of relevant information.

Westsource Group Holdings Inc. v. Canada (2018), 2018 CarswellNat 1158, 2018 FCA 57, Rennie J.A., Judith Woods J.A., and Laskin J.A. (F.C.A.); affirmed (2017), 2017 CarswellNat 2649, 2017 CarswellNat 9105, 2017 TCC 9, 2017 CCI 9, Valerie A. Miller J. (T.C.C. [General Procedure]).

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