Background
Melisa Jones received the Canada Recovery Benefit from December 2020 through October 2021. Eligibility required at least $5,000 in employment income or net self-employment income during a specified qualifying period. Because Jones had no relevant employment income, the Canada Revenue Agency focused on whether her 2020 net self-employment income from graphic-design work met that threshold.
Jones reported materially different business-expense figures during the CRA’s reviews: $4,174 on her original 2020 tax return, zero on a revised return, $480.77 on one spreadsheet, and an unclear amount on another. She acknowledged having incurred some expenses but lacked receipts or other records establishing their amount. After two earlier reviews and the informal resolution of a prior judicial-review application, the CRA’s third review concluded that it could not determine her net self-employment income and therefore could not confirm her eligibility.
Jones sought judicial review, arguing that the third decision was unreasonable and procedurally unfair. She also submitted evidence of a previously unreported $200 payment allegedly received in 2020.
The Court’s Holding
The Federal Court dismissed the application. It excluded the evidence concerning the additional $200 because it had not been before the CRA and did not fall within an exception permitting fresh evidence on judicial review. The Court emphasized that its role was to review the CRA’s decision on the existing administrative record, not to determine Jones’s eligibility anew.
The Court held that the CRA reasonably declined to treat Jones’s revised tax return as conclusive proof of qualifying income. Although the reviewing agent appeared to accept gross business income of approximately $5,685.97, the decisive problem was the inconsistent and unsupported expense information. Given those discrepancies, the CRA reasonably concluded that it could not calculate Jones’s net self-employment income or determine that she had met the statutory threshold.
The process was also fair. The CRA repeatedly identified its concerns about the expense figures and gave Jones and her representatives numerous opportunities to explain the discrepancies and provide documents. The agent was not required to arrange another call after Jones requested one in August 2025, particularly after her accountant said he could provide no further information. The Court awarded no costs.
Key Takeaways
- A tax return or assessment is relevant but not conclusive proof that an applicant earned the income required for COVID-benefit eligibility.
- An applicant claiming qualifying net self-employment income must provide sufficient, reliable evidence of both gross income and business expenses.
- Evidence that was not before the administrative decision-maker generally cannot be introduced on judicial review to establish eligibility.
Why It Matters
The decision underscores that judicial review is not an opportunity to rebuild a benefits claim with new evidence or ask the Court to recalculate eligibility. The question is whether the CRA reasonably assessed the record before it and used a fair process.
For self-employed benefit claimants, inconsistent expense reporting can be decisive even where gross income exceeds the statutory minimum. Contemporaneous records supporting both revenue and expenses are essential because eligibility turns on net, not gross, self-employment income.