CRA Ordered to Recognize London School of Economics : CRA SOTW
This is an example of the CRA (ab)using your tax dollars when a little common sense could have saved everybody involved both time and money.
DAD APPEALED DAUGHTER'S DEDUCTION
Taxman ordered to recognize London School of Economics
PAUL WALDIE
When Peter Shea's daughter Brigid enrolled in a master's program at the London School of Economics a couple of years ago, he was thrilled she had got into such a prestigious university.
The Canada Revenue Agency didn't see it that way.
The CRA disallowed tuition and education tax credits Mr. Shea had claimed when he prepared his daughter's 2006 taxes. The agency said the LSE was not an eligible university for the credits.
Mr. Shea was flabbergasted. "I couldn't believe it," he said from his home in Montreal, where he runs a business that supplies testing equipment to forest products companies.
He checked the CRA's list of more than 500 approved universities. It included the University of Oxford, Cambridge, Harvard, Yale, and even God's Bible School and College in Cincinnati, the Life Chiropractic College in California and the University of Tartu in Estonia. But not the LSE.
"They didn't recognize the London School of Economics even though half the civil service in Canada probably went there at one time or another, including past prime ministers Pierre Trudeau and Kim Campbell," Mr. Shea said.
He called the CRA.
"I said, 'Well it's not on the list, there must be some mistake.' " He explained that the Quebec government had approved a student loan for Brigid to attend the university and he noted that the LSE was part of the University of London, which was on the CRA's list.
Agency officials wouldn't budge. "It was absolute bureaucratic obfuscation or stonewalling," he said.
After months of phone calls and appeals, he took the matter to the Tax Court of Canada. The tax credits were worth only $1,700 to his daughter, but Mr. Shea was on a crusade to get the LSE included on the CRA list.
During a hearing last month he guided Judge Louise Lamarre Proulx through a list of 14 Nobel laureates and 39 heads of government who had attended the LSE. The university is "one of the most important international universities in the world," he argued.
A lawyer representing the CRA dug in and the hearing turned into a debate about the status of the LSE and the definition of a university.
In a ruling made public yesterday, Judge Lamarre Proulx upheld Mr. Shea's appeal. She ruled that the LSE is in fact "an educational institution granting university degrees" and that it qualifies as "a university outside Canada" for tax purposes.
The judge also questioned the CRA's list of approved universities, noting that most of them are from the United States. In fact, the list includes more than 400 American universities but only 37 in Britain, eight in France, two in Germany and one in Spain.
The list "may be useful to the CRA's agents as a first and quick reference regarding American universities, but care should be exercised with respect to European universities," the judge said in her ruling. She suggested that staff at Canadian embassies help determine the eligibility of foreign universities for CRA purposes.
Catherine Jolicoeur, a CRA spokeswoman, said in an e-mail that the agency is reviewing the decision "to determine the impact" and added that the decision could be appealed.
She declined further comment on the case but said: "Court decisions serve to clarify the law or resolve differences of opinion between the CRA and taxpayers."
Mr. Shea said he is just happy his year-long battle may finally be over. Brigid, his youngest of four children, graduated from the LSE last December with a master of science degree. Her subject area? Conflict studies.
A spokesperson for the LSE did not return calls for comment.
Recognized universities
A sampling of some of the schools that the Canada Revenue Agency does recognize:
Colorado School of Mines, Golden, Colo.
Conway School of Landscape Design, Conway, Mass.
God's Bible School and College, Cincinnati, Ohio
Maharishi University of Management, Fairfield, Iowa
Ohio College of Podiatric Medicine, Cleveland
Pontifical Gregorian University, Vatican City
Ukrainian Free University, Munich
University of Tartu, Tartu, Estonia
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Miss a Tax Tale Miss a lot!
Follow the link to the new Canada Revenue Agency Story Of The Week index!
http://groups.google.com/group/can.taxes/browse_thread/thread/0423e5e9d997c87f/7586401d55b15b1a#7586401d55b15b1a
-------------------------------------------------------------------------------------------------------
Alan Baggett
This is an example of the CRA (ab)using your tax dollars when a little common sense could have saved everybody involved both time and money.
DAD APPEALED DAUGHTER'S DEDUCTION
Taxman ordered to recognize London School of Economics
PAUL WALDIE
When Peter Shea's daughter Brigid enrolled in a master's program at the London School of Economics a couple of years ago, he was thrilled she had got into such a prestigious university.
The Canada Revenue Agency didn't see it that way.
The CRA disallowed tuition and education tax credits Mr. Shea had claimed when he prepared his daughter's 2006 taxes. The agency said the LSE was not an eligible university for the credits.
Mr. Shea was flabbergasted. "I couldn't believe it," he said from his home in Montreal, where he runs a business that supplies testing equipment to forest products companies.
He checked the CRA's list of more than 500 approved universities. It included the University of Oxford, Cambridge, Harvard, Yale, and even God's Bible School and College in Cincinnati, the Life Chiropractic College in California and the University of Tartu in Estonia. But not the LSE.
"They didn't recognize the London School of Economics even though half the civil service in Canada probably went there at one time or another, including past prime ministers Pierre Trudeau and Kim Campbell," Mr. Shea said.
He called the CRA.
"I said, 'Well it's not on the list, there must be some mistake.' " He explained that the Quebec government had approved a student loan for Brigid to attend the university and he noted that the LSE was part of the University of London, which was on the CRA's list.
Agency officials wouldn't budge. "It was absolute bureaucratic obfuscation or stonewalling," he said.
After months of phone calls and appeals, he took the matter to the Tax Court of Canada. The tax credits were worth only $1,700 to his daughter, but Mr. Shea was on a crusade to get the LSE included on the CRA list.
During a hearing last month he guided Judge Louise Lamarre Proulx through a list of 14 Nobel laureates and 39 heads of government who had attended the LSE. The university is "one of the most important international universities in the world," he argued.
A lawyer representing the CRA dug in and the hearing turned into a debate about the status of the LSE and the definition of a university.
In a ruling made public yesterday, Judge Lamarre Proulx upheld Mr. Shea's appeal. She ruled that the LSE is in fact "an educational institution granting university degrees" and that it qualifies as "a university outside Canada" for tax purposes.
The judge also questioned the CRA's list of approved universities, noting that most of them are from the United States. In fact, the list includes more than 400 American universities but only 37 in Britain, eight in France, two in Germany and one in Spain.
The list "may be useful to the CRA's agents as a first and quick reference regarding American universities, but care should be exercised with respect to European universities," the judge said in her ruling. She suggested that staff at Canadian embassies help determine the eligibility of foreign universities for CRA purposes.
Catherine Jolicoeur, a CRA spokeswoman, said in an e-mail that the agency is reviewing the decision "to determine the impact" and added that the decision could be appealed.
She declined further comment on the case but said: "Court decisions serve to clarify the law or resolve differences of opinion between the CRA and taxpayers."
Mr. Shea said he is just happy his year-long battle may finally be over. Brigid, his youngest of four children, graduated from the LSE last December with a master of science degree. Her subject area? Conflict studies.
A spokesperson for the LSE did not return calls for comment.
Recognized universities
A sampling of some of the schools that the Canada Revenue Agency does recognize:
Colorado School of Mines, Golden, Colo.
Conway School of Landscape Design, Conway, Mass.
God's Bible School and College, Cincinnati, Ohio
Maharishi University of Management, Fairfield, Iowa
Ohio College of Podiatric Medicine, Cleveland
Pontifical Gregorian University, Vatican City
Ukrainian Free University, Munich
University of Tartu, Tartu, Estonia
-----------------------------------------------------------------------------------------------------
Miss a Tax Tale Miss a lot!
Follow the link to the new Canada Revenue Agency Story Of The Week index!
http://groups.google.com/group/can.taxes/browse_thread/thread/0423e5e9d997c87f/7586401d55b15b1a#7586401d55b15b1a
-------------------------------------------------------------------------------------------------------
Alan Baggett