Tax Filing Myths – Twelve Canadian Ones

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Tax Filing Myths – Twelve Canadian Ones

Canadian tax filing myths include myths such as: having a definition for ‘income’; authorized form means a T1; filing private property is on a T1; you can only file on a T1; the SIN identifies you only one way; the SIN only has one legal meaning; not having to report private property; it is best to file just before the deadline; and accounting books and records belong to you.

Canadian tax filing myths: the law has a definition for ‘income’; T1 is an authorized form; filing private property is on a T1; can only file on a T1; the SIN identifies you only one way; the SIN only has one legal meaning; not having to report private property; best to file just before the deadline.

Summary

Some tax filing myths are: the law having a definition for ‘income’; authorized form means a T1; filing private property is on a T1; you can only file on a T1; the SIN identifies you only one way; the SIN only has one legal meaning; not having to report private property; it is best to file just before the deadline; and accounting books and records belong to you.

Tax Filing Myths #1: Canada’s Tax Laws Define What ‘Income’ Is

Tax Filing Myths #1: Canada’s tax laws define what ‘income’ is. It doesn’t. Image credit: www.empireclub.org

It doesn’t. Here is a speech to the Empire Club of Canada by a past President of the Certified General Accountant’s Association of Ontario admitting Canada’s tax laws do not define ‘income’. In contrast, we discovered there are two types of ‘income’ for individuals. (We call our research, “Apu’s Theory.”) Your income is either your private property or the law deems (a so-called “fact” that legally stands until you prove otherwise) it as Canada’s “public money1. Perhaps the Government does not want you knowing this?

Tax Filing Myths #2: ‘Income’ Belongs to You

 Canada’s tax laws deem you are receiving income belonging to Canada, as her “public money”. Therefore, the law deems it not yours.

Tax Filing Myths #2: Canada’s tax laws actually deem you receiving income as “public money”.

It also doesn’t. Canada’s tax laws deem you are receiving income belonging to Canada, as her “public money”. The law also says, “all public money shall be deposited to the credit of the Receiver General”. CRA’s T1 tax return form (up to 2013) 2 , on page 4, effectively says pay part of that “public money” as income tax. This is because it says pay the income tax by making “a cheque or money order payable to the Receiver General”. In short, the T1 is a document reporting ONLY “public money” you earned – for Canada. This also fits with economy forecaster Martin Armstrong saying a Canadian politician told him,

Everything you earn belongs to the state (Canada)… we decide how much you are allowed to keep.”

Tax Filing Myths #3: Authorized Form Means a T1

1990 T1 says, "Form authorized and prescribed by order of the Minister of National Revenue."

1990 T1 says, “Form authorized and prescribed by order of the Minister of National Revenue.” Since 1991 the T1 no longer says this.

Not any more! The T1 being a “form authorized and prescribed by order of the Minister of National Revenue” is on T1s up to 1990. Here is a 1990 T1.  Since 1991 T1s no longer say this. This means the T1 is no longer an authorized nor prescribed form. Furthermore, the Income Tax Act (“ITA“) says,

150(1) Subject to subsection (1.1), a return of income that is in prescribed form and that contains prescribed information shall be filed with the Minister, without notice or demand for the return, for each taxation year of a taxpayer

However, there are no legal definitions for “income“, “prescribed form“, “prescribed information“, “return“, or “return of income“! In addition, the ITA never says a “return of income” means a T1. Can a “return of income” be something other than CRA’s T1 form?

Tax Filing Myths #4: Property Filed on a T1 Stays Private

Tax Filing Myths #4: property filed on a T1 stays private. Image credit: www.theedublogger.com

Tax Filing Myths #4: property filed on a T1 stays private. Image credit: www.theedublogger.com

It does not. Filing private property on a T1 converts it into Canada’s “public money”. Therefore, you must file property staying private on something other than a T1. However, Canada no longer provides a form for filing your income as private property. They used to provide one. Is this to trick you into converting ALL your ‘income’ into “public money” belonging instead to Canada?

Tax Filing Myths #5: You Can File ‘Income’ Only on a T1

Canadian tax filing myths include you can only file on a T1. Ed Kroft, QC, LLB, LLM, CGA (Hon.) says in this issue of BCCGA Outlook magazine that it is wise to report non-taxable income by attaching a letter to your T1 return.

Tax Filing Myths #5 is you can only file on a T1. Ed Kroft says in BCCGA Outlook you can report non-taxable income by attaching a note to your T1. Image credit: www.bccpa

You can file by a note or letter since authorized forms no longer mean the T1, and Canada no longer provides a form for filing private property income. This court case and this article in “Outlook” by tax lawyer Ed Kroft also support filing tax return information by letter3. So does CRA’s 2016 5000-G General Income Tax and Benefit Guide, which says on page 30:

“If you have more than one type of income, attach a note to your paper return giving the details.”

Obviously, private property income and “public money” income are “more than one type of income“. Since “public money” income is filed on a T1, private property income can be filed by a note or letter. Is this why there is no definition for ‘income’ in the ITA, to trick you into converting ALL your ‘income’ into “public money”?

Tax Filing Myths #6: The SIN Identifies You as One (Legal) Person

The letter says, "Remove your Social Insurance Number (SIN) card from this page."

The letter says, “Remove your Social Insurance Number (SIN) card from this page.” Image credit: http://ameblo.jp/shigeki-ishii/entry-10739494738.html

Apu’s Theory concludes the acronym SIN can identify you as two (legal) persons. It concludes a SIN styled as a Social Insurance Number (as in the letter in the above picture) identifies you agreeing to income tax legal liability as an ITAlegal representative” (first legal person). It also concludes a SIN styled by CRA as a “social insurance number” identifies you consenting to holding a Canada Pension Plan (“CPP”) and/or Income Tax Act (“ITA”) office4, as a CPP/ITAofficer” (second legal person). Furthermore, CRA’s website has different explanations5 for the Social Insurance Number and the “social insurance number”! Finally, the Government of Canada CPB-15 form use both the Social Insurance Number and the “social insurance number”! Do you still think these two styles for the SIN are merely typos?

The SIN Has Only One (Legal) Meaning

Since 2001 the SIN has two (legal) meanings. The SIN only meant Social Insurance Number up to the 2000 T1 return. CRA started using the SIN to also mean “social insurance number” on their 2001 T1 return.

Tax Filing Myths #7: The Law Defines T1’s “social insurance number”

The T1 uses the SIN as a "social insurance number" styled with all lower case letters. It has no legal definition.

Tax Filing Myths #7: The law defines the T1’s “social insurance number”. Apu’s Theory concludes it identifies you as a CPP/ITA “officer”.

It is not defined. Canada’s laws do not define what the “social insurance number” styled with all lower case letters means. They also do not define “resident” or “source” either. This is deliberate. Is the Government hiding how their laws deem your ‘income’ as Canada’s “public money”? Does the “social insurance number”, styled with all lower case letters, identify you as a second (legal) person, a federal CPP/ITA “officer” receiving “public money” for Canada?

Tax Filing Myths #8: The T1 Always Used “social insurance number”

Another filing tax myth is the T1 is an authorized form. Since 1991 T1s no longer say it is a “form prescribed and authorized by the Minister of National Revenue”. The T1 is no longer an authorized form. You also cannot file private property income with the free CRA tax software.

You cannot file private property income with CRA’s free tax software. Is that why it is free? Image credit: CRA

It changed in 1991. The T1 used Social Insurance Number from 1966 to 1990. CRA started using “social insurance number” on their 1991 T1. If there is no difference, why did they change it?

Tax Filing Myths #9: You Do Not Have to Report Private Property

Reporting all income gives CRA clean hands to reassess your income taxes.

Reporting all income gives CRA “clean hands” to reassess your income taxes.

Yes you do. Canada’s tax laws, case law, and legal system deem you wish to convert your ‘income’ (private property) into Canada’s “public money”. Reporting your property’s status as private rebuts that deeming6. Not reporting it confirms their deeming. That could be why the law requires you reporting all ‘income’. Doing so gives you a way to claim your property as private. But does it also give CRA “clean hands7 to assess more income tax if you do not rebut their deeming?

Tax Filing Myths #10: File Near the Deadline

Tax Court of Canada appeals must be within 90 days. The tax filing deadline is over 90 days. This legally allows CRA to dispute your income’s status. Is this why the filing deadline is past 90 days? See www.canadaincometaxislegal.is

Tax Court of Canada appeals must be within 90 days. The tax filing deadline is over 90 days. Does this allow CRA to dispute your income’s status? Is this why the filing deadline is over 90 days past December 31st?

File as early as possible. The April 30th deadline means filing over 90 days past when you last earned income for the previous taxation year (December 31st). Being over 90 days legally allows CRA to dispute your income’s status. For example, most court appeals, including the Tax Court of Canada, are within 90 days. Is this why the filing deadline, April 30th, is over 90 days past December 31st?

We believe it is better to pre-emptively claim your income’s status at the start of every new taxation year. Why? Because CRA does this! They want you filling out their TD1 form at the start of a new job, or a new taxation year. This means you consent to receiving income as “public money” for Canada. Then it is no longer a deeming. You confirmed it. Likewise, you can file something resembling our ISD1 form. This claims your income as private, and rebuts their deeming. Then file all income as soon as possible after that taxation year is over.

Tax Filing Myths #11: Books and Records Belong to You

CRA officers also are two (legal) persons: as an individual, and as a CRA officer. If they can, so can you!

A CRA officer is three legal persons: individual, CRA officer, and CPP/ITA “officer”. Image credit: Jean Levac, Postmedia News

No, they don’t. The books and records are deemed belonging to Canada. This is because the tax laws, case law, and legal system deem you wish to convert your private property income into “public money”. The law says all books and records for accounting the money belonging to Her Majesty: “shall be deemed to be chattels (movable property) belonging to Her Majesty”. That is why any CRA officer, as agent for Canada, can walk into any activity (or bank) in Canada and demand to see books and records (and bank statements). By the way, a CRA agent is three legal persons: individual, as a CRA officer, and being paid as a CPP/ITA “officer”.

Tax Filing Myths #12: Books and Records Do Not Say “Public Money”

In any judicial proceeding, books and records are admissible in evidence and the fact is deemed to be established in the absence of any evidence to the contrary.

Tax Filing Myth #12: Your books and records do not have to say “public money”. The law deems them as accounting for Canada’s “public money” unless there is contrary evidence.

They don’t have to. The law says if Canada deems any so-called “fact”, such as the books and records are accounting for money belonging to Her Majesty (Canada), “then, in any judicial proceeding, the document is admissible in evidence and the fact is deemed to be established in the absence of any evidence to the contrary.

Conclusion

The Government is entrapping taxpayers through uninformed consent by not defining key words and phrases such as “income”, "prescribed form", "prescribed information", “resident”, “social insurance number”, and “source”. They also don't teach tax accountants and lawyers how Canada’s tax laws really work.

The Government entraps taxpayers through uninformed consent by not defining key words and phrases. They don’t teach accountants and lawyers how tax laws really work. CRA also feeds professionals misleading information. If so, whose hands should be in the above picture? Are they “clean hands”? Image credit: CRA

Many Canadians believe these tax filing myths because the Government entraps taxpayers through uninformed consent by not defining “income”, “prescribed form”, “prescribed information”, “resident”, “return”, “return of income”, “social insurance number”, and “source”. They also don’t teach professionals how tax laws really work. They give out misleading information. Compare this un-released September XX, 2010 Press Release versus this November 30, 2011 CRA Tax Alert. We believe the earlier one was never released because it exposes how income tax really works (you can be two legal persons for income tax purposes?) Is all this institutional fraud? After all, it seems Apu’s Theory explains Canada’s income tax better than CRA’s dogma.

This is a Cornerstone Article. Find the other Cornerstone Articles by clicking on it within “Tags” near the top right hand corner of this article.

 

  1. Section 2 of Canada’s Financial Administration Act defines “public money”.
  2. CRA’s current 5000G General Income and Benefit Guides also say this.
  3. CRA is pushing taxpayers into filing electronically. Electronic filing has no provisions for filing private property income.
  4. “Office” as defined by s.2(1) of the CPP and s.248(1) of the ITA. Both laws also define you holding such an office as an “officer”.
  5. They are explanations and not statutory definitions. They carry zero legal weight. Nonetheless, it is telling CRA gives the two SINs different explanations.
  6. Probably a claim to beneficial title.
  7. Clean hands” is an equity law legal doctrine: “A maxim of the law to the effect that any person, individual or corporate, that wishes to ask or petition a court for judicial action, must be in a position free of fraud or other unfair conduct.” (Duhaime’s Law Dictionary)

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