I. General Comment
In 1966, the Carter Commission recommended that the
income tax system should consider the family (spouse and minor
children) as the basic unit for determining tax liability. Canada
did not accept the recommendation for various political reasons. As
a result, the general rule in Canadian income tax law is that each
individual member of the family is a separate taxpayer, has an
independent status, and is liable for tax on his or her personal
income. This has contributed to much of the complexity in the
personal income tax system.
The question: "whose income is it?" actually has two
answers. For commercial purposes, income belongs to the person who
owns it as a matter of personal property law. Under the
Constitution, this is determined according to provincial
law. For federal tax purposes, however, an individual may be
taxable on income that he or she does not own in a commercial sense
but to whom the income is "attributed".
