The Burdens Of Proof
Right there with wet pant cuffs and a flooded basement, tax time is one of the few irritations that come with spring. We corral all those slips and receipts cluttering counters and tabletops and set aside a night—or a couple, if we’re being honest—to get lost in a tedious adult version of a choose-your-own-adventure book. Numbered boxes on forms direct us to new forms, which point us back to the old form to reference and later cross-reference. When we finally get to the end, we’re left with a number—and more than a few doubts about how we got to it. For most of us, that’s it. We send the forms away and generally forget about them. But for some Northerners, there’s a lingering dread—they know their work isn’t over just yet.
Yellowknifer Darcy Bourassa (full disclosure: a good friend of mine) has been a homeowner for three years, but he’s already been audited once and is under review for this past year.
His troubles stem from the location of his home; it sits on no street, at no fixed address. Instead, it floats on the water, or is frozen in, at the same (relative) spot on Yellowknife Bay year-round. This is problematic when claiming the Northern residents deduction—a reimbursement to partially offset the high costs Northerners pay for fuel, goods, travel, you name it. The Canada Revenue Agency wants home insurance forms, utility bills, municipal tax receipts to prove residency. But houseboats are uninsurable, and because Darcy lives off-grid, he doesn’t have any utility bills. And he can’t provide municipal tax documents because houseboaters aren’t technically on municipal lands and don’t pay those. (Not going there.)
That means they have to get creative. Darcy was initially told he could use a city GIS program—sort of like Google Earth—to send in photos from different parts of town looking out onto his house on the bay, along with his home’s coordinates. But that wasn’t good enough for the CRA. He’s toyed with asking his propane supplier to write a fictional address—say, 2 South Dog Island—on a bill when he picks up his tanks, but has wisely decided against this. Last year, in desperation, he took a long shot and sent in an information package on the short-lived Ice Lake Rebels Reality TV show, set in Yellowknife Bay, which exaggerated the plight of houseboaters. “Part of me didn’t think that would work because the show doesn’t talk about Yellowknife much, but you can see it’s in the Northwest Territories at least,” he concedes. Darcy works at a diamond mine on two-week rotations, so he can’t just provide a paystub from work. (Many Northern mine workers live in the south on their time off but still try to get that living allowance, and the CRA’s grown wise to the scam.)
This burden of proof isn’t unique to Darcy. Some houseboaters, he’s heard, have even registered their homes as mooring points with the Canadian Coast Guard to prove their residency. But if houseboaters—and squatters with shacks along highways or outside municipal boundaries—seem the target of some malicious conspiracy, they’re not. In fact, it’s a Catch-22: the difficulties they have proving where they live means they often fall under the Eye of Sauron. Filing in the North—with all the claims and credits—adds yet another layer of complexity onto an already taxing process. And the exorbitant airfares to and from southern Canada means NWT and Nunavut travel claims come in higher than other Northern locales, and get flagged automatically for review by tax assessors. If you make a mistake on your forms or have inadequate documentation, you’re on the review list until you file everything perfectly and break the cycle. Right now, Darcy’s compiling documents to fulfill his 2015 review. He’s already thinking about what to include for 2016.
But he recently got some good news. As fall turned to winter, winds lashed wave after zero-degree wave against his houseboat. They quickly froze and began to weigh down his home—the northwest corner of his boat was starting to dip under the weight. Darcy caught the first plane back from camp when he heard and he spent the weekend dangling over the side of his home, chipping ice off his floats and the boat’s platform with a rubber hammer—causing him to end each day with a couple back pain pills.
How is that good news? Well, the drama was documented in that Friday’s newspaper. The headline: “Houseboats in distress on YK Bay.” Darcy, identified as the owner of one of the two houseboats, tells the reporter he’s not too worried about the situation. In fact, it may have just solved a problem—he’ll be sending that story to the taxman as proof of residency.