Sara Jahanbakhsh

The appellant, having succeeded in its appeal against a GAAR reassessment, sought costs.

The appellant had made a settlement offer and obtained a more favourable judgment, entitling it to substantial indemnity costs for the post-offer period.

The parties disputed the costs for the pre-offer period.

The court exercised its discretion to award enhanced pre-offer costs rather than tariff costs, finding that limiting the appellant to tariff costs would undermine the policy goal of encouraging early settlement offers.

The court awarded lump sum costs of $870,595.12.

The appellant appealed reassessments made by the Minister of National Revenue for the 2007, 2008, and 2009 taxation years, which included unreported income and assessed gross negligence penalties.

The appellant argued that the amounts received from a business associate were reimbursements for credit card expenses, not income from his role in a non-profit foundation.

The Tax Court of Canada dismissed the appeal, finding the appellant's testimony lacked credibility and was contradicted by documentary evidence.

The Court upheld the reassessments beyond the normal period, the inclusion of the amounts as income from an office, and the gross negligence penalties.