A simple question lies behind Patrick de Kruyff’s Tax Court of Canada victory last month over the Canada Revenue Agency (CRA): Who on earth would suggest taking Toronto’s Don Valley Parkway at rush hour?
An auditor in Vancouver, that’s who.
The basic rule for the deduction is that the move has to cut at least 40 kilometres off the daily commute.
But for some reason Google Maps kept giving the CRA a much shorter route than it did de Kryuff, despite the fact they both punched in the same coordinates at the same time of day Monday to Friday — the heart of rush hour, 4:45 p.m.
And then de Kruyff found the flaw that led to a precedent-setting ruling that could pave the way for tax relief for other urban commuters: the CRA’s employee was in B.C. — getting Google Maps’s suggestions to navigate Toronto traffic at 4:45 p.m. Pacific time.
That’s 7:45 p.m. Eastern.
For those wondering.
The claimant was comparing the route suggested by Google maps between their old location to work and their new location to work, in order to make a tax claim for having moved more than 40 km to improve their commute time.
The tax department was denying the claim because they were seeing a different route suggested, because they were checking from a different timezone. Their local clock said the same as the claimant’s clock, but the two timezones were different, so traffic conditions were different, thus the suggested route was different and the total distance travelled was different.
This opens up a whole different can of worms, but I’ll leave you to discover what happens when you rely on a third party mapping service to make tax deductible decisions. For example, what happens when Google changes how it calculates “the fastest route” between the time when you make a claim and when the tax department checks? What happens when you tick “avoid toll roads” and they don’t, what happens when you pick “best environmental route” and they don’t, electric vs petrol, plug type vs charge level, etc.
Moving deduction eligibility is based on “shortest public route” distances. Travel speed is irrelevant. Claimant is incorrect, regardless of time of day the route is selected.
Edit: this might be the rule now BECAUSE of this claimant
The idea is that you move closer and burn less fuel, and waste less time, so government incentives help people make better choices for the planet and congestion and life valance. Nobody is going to purposely take the shortest route if it ends up taking more time and bumper to bumper traffic, its counter productive.
If thats the case, why is there zero consideration for wàking, biling, or public transit? Why is there zero consideration for number of rooms (increasing for children, decreasing afterwards)?
I assumed the intent behind >40km was to change cities. I can’t see any way its related to the planet or life balance.
The intent does help city congestion, but there is no stipulation you had to move into a city area, just 40km closer. So you could live in farmville and move 40km and still be in farmville and have to drive into a city and that counts.
My understanding was for all the benefits that come with being closer to work, but maybe that is not the reason the government set it up.
Sounds like it wasn’t that Google Maps helped beat the tax collector, but that the tax auditor’s inability to apply time zone corrections appropriately caused a bunch of extra work for the GTA commuter. Glad it got sorted out, and hopefully auditors in the future will all learn from this example.
Ps: it was intentional (ie: not accidental) by the auditor.
He says he cross-examined the Vancouver-based auditor who would have had him travel the Don Valley Parkway at the height of rush hour, and she noted the CRA’s rules for calculating distance don’t make any allowance for time of day.
The whole article is a tour de force and worth the read.
Vancouver person with two lane highway at home, weighing in on traffic in Toronto his hilarious
I think the part that really highlights the situation are these two parts: First, they used the same times, but different time zones; second, they used the excuse of CRA rules not taking current traffic into consideration. What this shows is that the CRA auditor made a mistake and rather than just admitting it, they doubled down and engaged in a years-long legal battle. After all, if time of day didn’t matter, why didn’t they just put in 2 AM as the time for the trip?
