Case information

Taxation — Income Tax — GST — Assessment — Net worth assessments issued by Minister of National Revenue as records provided by taxpayer were grossly inadequate — Assessment methodology involves making estimate of increases to taxpayer’s net worth — Court of Appeal dismissing appeal of decision confirming assessment — Whether Federal Court of Appeal erred in admitting computer-generated casino records — Income Tax Act, R.S.C. 1985, c. 1 (5th Supp.) — Excise Tax Act, R.S.C. 1985, c. E-15.

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The applicant, Thanh Truc Truong appealed net worth assessments issued against her by the Minister of National Revenue, under the Income Tax Act, R.S.C. 1985, c. 1 (5th Supp.) and the Excise Tax Act, R.S.C. 1985, c. E-15.

Net worth assessments were issued by the Minister in this case because the records provided by Ms. Truong were grossly inadequate. The assessment methodology involves making an estimate of increases to a taxpayer’s net worth. The assessments under the Income Tax Act added to income an aggregate amount of $1,682,509 for the 2005 to 2009 taxation years, inclusively. They also imposed gross negligence penalties with respect to these amounts. The assessments under the Excise Tax Act assumed that Ms. Truing had unreported GST collectible for the same periods in an aggregate amount of $92,185. Gross negligence penalties were also imposed on these amounts.

Ms. Truong appealed the assessments to the Tax Court, which upheld them except for a small reduction in unreported income. The Federal Court of Appeal found the Tax Court had made no reviewable error and the appeal should be dismissed.