Executive Summary: Key Legal and Evidentiary Issues

• Heather Sinclair, a self-represented litigant, sought judicial review of CRA's decision finding her ineligible for Canada Emergency Response Benefits (CERB) she had already received.

• Eligibility under the Canada Emergency Response Benefit Act required at least $5,000 in before-tax employment or self-employment income in 2019 or in the 12 months before the date of the first application.

• Heavily redacted bank statements submitted by the Applicant showed only small e-transfer deposits with no indication of provenance, failing to substantiate the required income threshold.

• The CRA's second reviewer could only validate $413.09 of gross business income from the Applicant's documentation, falling far short of the statutory $5,000 minimum.

• New evidence the Applicant attempted to introduce after the second review decision was inadmissible on judicial review, as the Court is limited to the record before the administrative decision maker.

• Applying the standard of reasonableness per Canada v. Vavilov, the Federal Court found the Applicant failed to show the CRA's decision lacked justification, transparency, or intelligibility, and dismissed the application.

Background and facts of the case

Heather Sinclair applied for and received Canada Emergency Response Benefits for two periods: March 15, 2020 to April 11, 2020, and May 10, 2020 to September 26, 2020. The CERB was made available pursuant to the Canada Emergency Response Benefit Act (SC 2020, c. 5, s. 8) to provide rapid financial relief to millions of Canadians during the COVID-19 pandemic. A key eligibility requirement was that applicants must have before-tax income from employment or self-employment totaling at least $5,000 in 2019, or in the 12 months before the date of the first application for CERB.

The Applicant's self-employment activities

Mrs. Sinclair claimed self-employment income from two ventures. The first was "High Entertainment Services," through which she was involved in stage management, bookings, and promotion in the music industry. The second was "Taxes Done Right," under which she did some bookkeeping and filed taxes on behalf of clients. Due to the COVID-19 pandemic, her sources of self-employment income dried up in March 2020.

CRA's ex post facto review process

Because the CERB was delivered rapidly to millions of Canadians, the Canada Revenue Agency, which administers the CERB on behalf of the Minister of Employment and Social Development, conducted ex post facto verification activities to protect the integrity of the system. In a letter dated November 23, 2023, the CRA advised Mrs. Sinclair that a review was to be conducted of her eligibility for the benefits she had already received. The letter specified the types of acceptable documentation for self-employed individuals, including invoices for services rendered, receipts of payment, documents showing income earned as a sole proprietor, an independent contractor, or a partnership, and any other documents confirming $5,000 in employment or self-employment income was earned.

The first and second review decisions

Mrs. Sinclair submitted evidence of her eligibility on four occasions: December 5, 2023, February 23, 2024, June 2, 2024, and July 2025. Her primary evidence consisted of bank account statements covering the period from January 1, 2019 to April 30, 2020. However, the statements were heavily redacted, with most of the entries blacked out, including all of the withdrawals, leaving only some e-transfers identified with a number and only for amounts that were deposited. The deposits were generally for small amounts — $50, $60, $80 for instance — with no indication of provenance. The first CRA reviewer determined, in a decision letter dated May 28, 2024, that Mrs. Sinclair was not eligible because she did not earn at least $5,000 of employment and/or self-employment income in 2019 or in the 12 months before the date of her first application. She requested a second review on June 2, 2024, to be completed by an officer other than the one who conducted the first review. The second reviewer, in a decision letter dated July 28, 2025, reached the same result. The reviewer confirmed that the 12-month period ran from April 6, 2019 to April 5, 2020, and not from March 15, 2019 to March 15, 2020 as the Applicant had suggested. For that period, the amounts reached a total of $4,546. After attempting to align the Applicant's copy-and-pasted email correspondence — reflecting first names, dates, reviews, and totals — with highlighted e-transfers deposited throughout her bank statements, the reviewer was only able to substantiate $413.09 of gross business income earned within those 12 months.

The judicial review application

Mrs. Sinclair, representing herself, filed an application for judicial review before the Federal Court pursuant to s. 18.1 of the Federal Courts Act, framing it as a request for a "third review." She argued that the CRA agent had relied solely on the "in the twelve months prior" qualification for CERB and did not realize that the initial amended income for March 2019 actually made the qualification of $5,000 income in 2019 apply. She produced two affidavits — one sworn and one unsworn. The Court noted the unsworn affidavit was not a valid affidavit under rules 80 to 85 and Form 80A, and no consideration was given to it. The sworn affidavit sought to establish that after the decision under review had been rendered, the Applicant realized that more income than previously stated had now been found, explaining that she had declared income of $4,835 for 2019 but believed there was more. She also invoked s. 231.2 of the Income Tax Act, requesting an order to authorize the Minister to impose on a third party a requirement to obtain client information.

The Court's analysis and standard of review

Justice Roy confirmed that the applicable standard of review for CERB eligibility decisions is reasonableness, consistent with the presumption established in Canada (Minister of Citizenship and Immigration) v. Vavilov, 2019 SCC 65 and as applied in Aryan v Canada (Attorney General), 2022 FC 139. Under this standard, the Applicant bore the burden of demonstrating that the decision suffered from sufficiently serious shortcomings such that it could not be said to exhibit the hallmarks of reasonableness: justification, transparency, and intelligibility. The Court emphasized that a judicial review considers only the record that was before the administrative decision maker, citing the principle from Bernard v. Canada Revenue Agency, 2015 FCA 263, that evidence which could have been placed before the administrative decision maker is not admissible before the reviewing court.

Ruling and outcome

The Federal Court dismissed the judicial review application. Justice Roy found that the Applicant failed to discharge her burden to show any shortcoming in the decision under review. The new evidence she attempted to place before the Court was inadmissible, as it was not before the decision maker at the time of the second review, and no exception to this general rule applied. The Court found that it had not been shown that the requirement to validate e-transfers on bank statements — with some evidence that these e-transfers reflect and constitute income of at least $5,000 — was unreasonable, noting that e-transfers without more constitute only evidence of deposits and withdrawals of funds, with their source and purpose unknown. The Applicant does bookkeeping, yet there were no books; there were very few invoices and no records. The decision maker was able to validate $413 worth of services rendered. The Applicant was reported as having said in one of her conversations with CRA personnel that nothing exists. The request to invoke s. 231.2 of the Income Tax Act was also rejected, as that provision applies on its face only to verify compliance with any duty or obligation under the Income Tax Act, not the CERB Act. The Canada Revenue Agency was the successful party. No costs were awarded, as counsel for the Respondent, Diying Wu, advised the Court that she would not be seeking costs if the judicial review were dismissed. No specific monetary amount was ordered or awarded in the judgment.