The corporate taxpayer appealed reassessments for its 2014, 2015, and 2016 taxation years.
The Minister reassessed the 2014 and 2015 years beyond the normal reassessment period to include an omitted capital gain and adjust capital cost allowance and recapture, and imposed gross negligence penalties for all years.
The Tax Court of Canada found that the failure to review the corporate tax returns before filing constituted neglect or carelessness, justifying the statute-barred reassessments.
However, the Court vacated the gross negligence penalties, finding the taxpayer's reliance on its accountants and the circumstances did not amount to gross negligence.
