Self-assessment is a cornerstone of Canada’s income tax system. The Government will not file for you even though it has most of the data. This is because Canadian tax laws deem your income as Canada’s “public money”. You must freely consent to this. No self-assessment would mean the Government is then stealing your private property.
Jamie Golombek wrote an article yesterday for the National Post. It is titled, “The CRA Has Our Data – So Why Are We Still Filling Out Those Crummy Forms?” The article’s subtitle is, “It’s a statement on how complex our tax system is that Canada does not file returns for its residents as many other countries do.”
While we agree it is complex, we also think that is not the main reason. In fact, we think Canada would be breaking the law if it filed individual returns. That is because freewill is a right of liberty under Section 7 of the Canadian Charter of Rights and Freedoms. You decide what type of income you made. Does it stay as your private property, or do you consent it being deemed as Canada’s “public money”? That is the hidden part of self-assessment – the type of income. (Conveniently, the Income Tax Act does not define “income”).
Well, it’s a self-assessing system, so we’re out there to ensure that the taxpayers comply with the Income Tax Act.
Common law principles are the basis for Canada’s laws. This is due to being part of the former British Commonwealth. Biblical laws are the basis for common law. The Eighth Commandment says, “you shall not steal”. Therefore, under common law, private property ownership is an inalienable human right from your Creator.
This means only you can legally consent to converting your paycheques (your private property) into “public money” belonging to Canada. That is why self-assessment is a cornerstone of Canada’s income tax. It safeguards Her Majesty (Canada) from stealing. Theft, including theft through conversion, is a Criminal Code offence. Self-assessment helps Her Majesty (and her agents) stay honourable.
Countries outside of the former British Commonwealth mostly have civil law based legal systems. This means property ownership is only a privilege granted by those governments. Privileges are revokable. Therefore, self-assessment on type of income is not a cornerstone of income tax in civil law countries. That explains why some civil law countries, such as Sweden, and also Norway, file tax returns for its people.
Civil law is also the basis for Quebec’s laws. This fits with the same National Post article saying, “In 2008, Revenue Quebec experimented with the use of pre-filled tax returns.”
“Apu’s Theory”, our research on Canada’s income tax, concludes Canada’s tax laws deems individual income to be Canada’s “public money”. CRA’s T1 Income Tax and Benefit Return with the SIN as a “social insurance number” styled with all lower case letters reports that type of income. However, the Government no longer provides a form for reporting income as private property. Apu’s Theory concludes a letter with the SIN as a Social Insurance Number styled with upper and lower case letters can report income as private property. This article shows the Government using both styles of SIN on one document.
Corroborating this is the above RC143 E (04)X form. “(04)” means drafted in 2004. It is titled, “Income Tax Return Information – Regular”. It is also called an Option C Printout.
The first oddity is nowhere on this RC143 shown above does it mention any T1 Income Tax and Benefit Return. However, the Income Tax Act never mentions T1 either. In addition, the T1 is no longer an authorized form. Could this mean filing by letter is legally acceptable?
The second oddity is this RC143 uses the SIN as a Social Insurance Number as required by Section 237(1) of the Income Tax Act. However, since 1991 the T1 uses the SIN as a “social insurance number” styled with all lower case letters. You would think the RC143 should use that style of SIN. It doesn’t.
This RC143 summarizes income tax return information. If Apu’s Theory is correct, it then is a summary of all tax information from T1s (public money income) as well as all tax information from income tax returns by letters (private property income). In addition, Apu’s Theory concludes a SIN used as a Social Insurance Number means you agreeing to be legally liable. Therefore, this RC143 uses that style of SIN as a file identifier, and also as you agreeing to be legally liable for both T1 “public money” filings and for filings of private property income via letters.
Canada’s Government will not file for you even though it has most of the data. This is because you must consent to your income being deemed as “public money”. That is why self-assessment is a cornerstone of Canada’s income tax system. In conclusion, this RC143 form corroborates Apu’s Theory that income tax return information is both the amount and type of income. This is also summarized in our blog article, “Tax Filing Myths – Twelve Canadian Ones“.