Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.
Principal Issues: Whether the word "answer" in s. 163(2) would include a verbal reply.
Position: No; "answer" refers to a written reply.
Reasons: The enumerated list in subsection 163(2) implies that the word "answer" refers to written documents. Furthermore, the terms in the list are referred to as "returns", which suggests that the terms relate to written documents. Therefore, the noscitur a sociis rule (associated words rule) applies, whereby a word takes its meaning from the words with which it is associated. Accordingly, "answer" refers to a written reply.
XXXXXXXXXX 2011-042115
Lindsay Frank
Attention: XXXXXXXXXX
October 3, 2011
Dear XXXXXXXXXX :
Re: Meaning of "Answer" in Subsection 163(2)
This is in reply to your inquiry regarding the meaning of "answer" in subsection 163(2) of the Income Tax Act. At issue is whether "answer" would include a verbal reply by a taxpayer to a question posed by an auditor.
For subsection 163(2) to apply, a taxpayer must have knowingly, or in circumstances amounting to gross negligence, made or participated in, assented to or acquiesced in the making of a false statement in a return filed or made in respect of a taxation year. For the purposes of this provision, a return includes a form, certificate, statement, or answer.
A reading of the enumerated list in subsection 163(2) implies that the word "answer" refers to written documents and not verbal answers. The fact that the Act provides that, for the purposes of subsection 163(2), the terms shall be referred to as "returns" further suggests that the terms relate to written documents. This conclusion is supported by the noscitur a sociis rule (associated words rule) of statutory interpretation, whereby a word takes its meaning from the words with which it is associated. Accordingly, "answer" in subsection 163(2) relates to written documents.
Should you have any questions or require additional information, please do not hesitate to contact Lindsay Frank at the number provided at the outset of this letter.
B.J. Skulski
Manager
Insolvency and Administrative Law Section
Income Tax Rulings Directorate
All rights reserved. Permission is granted to electronically copy and to print in hard copy for internal use only. No part of this information may be reproduced, modified, transmitted or redistributed in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, or stored in a retrieval system for any purpose other than noted above (including sales), without prior written permission of Canada Revenue Agency, Ottawa, Ontario K1A 0L5
© Her Majesty the Queen in Right of Canada, 2011
Tous droits réservés. Il est permis de copier sous forme électronique ou d'imprimer pour un usage interne seulement. Toutefois, il est interdit de reproduire, de modifier, de transmettre ou de redistributer de l'information, sous quelque forme ou par quelque moyen que ce soit, de facon électronique, méchanique, photocopies ou autre, ou par stockage dans des systèmes d'extraction ou pour tout usage autre que ceux susmentionnés (incluant pour fin commerciale), sans l'autorisation écrite préalable de l'Agence du revenu du Canada, Ottawa, Ontario K1A 0L5.
© Sa Majesté la Reine du Chef du Canada, 2011
Email this Content