A W Prociuk:—The appellant appeals from the respondent’s reassessment wherein a voluntary contribution of $1,500 in the taxation year 1971 into a registered pension plan for past services was disallowed.
In that year the appellant who worked for the same group of companies, Robson-Lang Leathers Lid or its predecessor companies, continuously since 1945, contributed the sum of $1,500 in 1977 in respect of current services. He then made a voluntary contribution of another $1,500 for past services for the year 1944. At the hearing of this appeal, the appellant testified that in 1944 he was a member of the Canadian Armed Forces. In each of the years 1945 to 1970 inclusive he made contributions in varying amounts to a pension fund established by his employer.
Mr F Lorenzen, CA, argued on behalf of the appellant that the appellant was entitled to make a voluntary contribution of $1,500 for the year 1944 pursuant to the provisions of paragraph 11(1)(i) of the Income Tax Act as it was in force in 1971, by reason of the fact that he was not a contributor in the year 1944. The section reads as follows:
11. (1) Notwithstanding paragraphs (a), (b) and (h) of subsection (1) of section 12, the following amounts may be deducted in computing the income of a taxpayer for a taxation year:
(i) amounts contributed by the taxpayer to or under a registered pension fund or plan,
(i) not exceeding in the aggregate $1,500 in the year, if retained by his employer from his remuneration for or under the fund or plan in respect of services rendered in the year or paid into or under the fund or pian by the taxpayer as part of his dues for the year as a member of a trade union,
(ii) not exceeding in the aggregate, the lesser of
(A) $1,500 paid in the year into or under the fund or plan by the taxpayer in respect of services rendered by him previous to the year while he was not a contributor, or
(B) that part of an amount paid in the year into or under the fund or plan by the taxpayer in respect of services rendered by him previous to the year while he was not a contributor that is not in excess of the amount obtained by multiplying the number of years previous to the year in which he rendered services while he was not a contributor by $1,500 and subtracting from the product the aggregate of all amounts deducted under this subparagraph in previous years,
to the extent not deductible in the immediately preceding year under paragraph (u), and
(iii) not exceeding in the aggregate $1,500 minus any amount deducted under subparagraph (i) or (ii) in computing his income for the year, paid in the year into or under the fund or plan by the taxpayer in respect of services rendered by him previous to the year while he was a contributor, to the extent not deductible in the immediately preceding year under paragraph (u);
In Beauchamp v MNR, [1972] CTC 2077; 72 DTC 1086, Mr A J Frost, FCA, the presiding Member of the Board, stated at pages 2078 and 1087 respectively:
The section indicates clearly that where a taxpayer is a contributor he is not permitted to deduct more than $1,500 for current and/or previous services in any taxation year. As the appellant was a participating member of the plan from 1944 and contributed to the plan on a regular basis, he is not entitled to deduct more than $1,500 in any taxation year.
I am in complete agreement with that interpretation.
In the instant case, the appellant was a non-contributor in 1944. It would appear to me that before the appellant may deduct a contribution for that year, he would have to establish that there was a pension fund or plan registered by the respondent which entitled him to do so notwithstanding the fact that he was not employed by his present employer or its predecessor. There is no evidence to this effect.
The appeal is dismissed.
Appeal dismissed.