The taxpayer appealed reassessments for the 2009, 2010, and 2011 taxation years, which were based on a net worth assessment by the Minister.
The Minister added undeclared income in the form of shareholder benefits from a corporation that owned a gas station, assessed beyond the normal reassessment period for two years, and imposed gross negligence penalties.
The Tax Court of Canada dismissed the appeal, finding that the taxpayer failed to keep adequate records, the net worth assessment methodology was appropriate, and the taxpayer's claims of 'friendly debt' were unsubstantiated.
The Court upheld the reassessments beyond the normal period and the penalties, concluding that the taxpayer's failure to maintain records and reliance on estimated income constituted gross negligence.
