The federal government has won an appeal, requiring a tax advisor to turn over his client list to Revenue Canada.

In the Court of Appeal of British Columbia, the Crown sought to overturn the decision of a Summary Conviction Appeal judge to allow an appeal by Anthonius Van Egmond., who had been convicted by a judge of the B.C. Provincial Court on two counts of failing to provide material to the government agency.

Van Egmond is a tax advisor who had not filed his own personal tax returns for seven years. In January 1999 he filed all seven years at once. And, as a result, he was audited. During the course of that audit, he was willing to disclose his records, but not his clients’ names and addresses.

Originally Van Egmond expressed concerns that the information might be used to audit his clients’ GST returns, which he thought would hurt his reputation. He sought assurances that the information would not be used for this purpose. When he was unable to obtain these assurances, Van Egmond refused to provide the requested information. He was then charged under the Income Tax Act.

After a trial in Provincial Court, Van Egmond was convicted. The Provincial Court judge held that, while Van Egmond might have had reasonable excuse not to include client information, he was obliged to provide the other, non-client, information. Van Egmond appealed and was acquitted. That judge found that the information sought was for more than assessing Van Egmond’s tax liability, and that Revenue Canada’s purposes extended to potentially assessing his clients. The Summary Conviction Appeal judge stated that the central issue was the extent to which a taxpayer under audit is obliged to comply with a demand for information when that information relates to clients (third parties) who are not themselves under any audit.

The appeals court has now held that the client list would legitimately be required for the personal audit, and that Revenue Canada is authorized to pass along taxpayer information to other tax collection officials.