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Tax Free Savings Accounts

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  • Hunt v. R. – TCC:  Constitutional challenge to Tax Free Savings Account rules fails
    Oct 11, 2018 By Bill Innes

    Précis: The Income Tax Act (Act) contains in section 207.05 (and related provisions) a somewhat complex set of rules governing the use of Tax Free Saving Accounts (TFSAs). Mr. Hunt was assessed taxes of $24,833, $14,973, $35,441 and $49,158 on the basis that he had infringed those rules in 2010, 2011, 2012 and 2013, respectively, and he appealed to the Tax Court. This is the report of a motion pursuant to subsection 58(1) of the Tax Court of Canada Rules (General Procedure) to determine two constitutional questions: (a) Is section 207.05 of the Income Tax Act (Canada) unconstitutional for impermissibly infringing on the right to make laws respecting “Property and Civil Rights” which is granted exclusively to the provinces under subsection 92(13) of the Constitution Act, 1867?; or (b) Is section 207.05 of the Income Tax Act (Canada) unconstitutional as a consequence of Parliament having improperly delegated the rate-setting element of the charge imposed thereunder to the Minister of National Revenue in contravention of section 53 of the Constitution Act, 1867? Pizzatelli J. held that section 207.5 was not unconstitutional under either argument and answered both questions No. The Appellant was ordered to pay the Repondent’s costs in any event of the cause.
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