When you hear advertisements telling you that if you are behind filing tax returns or have undeclared income that you could be subject to criminal prosecution, know that this is not just a scare tactic. It is very real. In fact, average Canadians are prosecuted every month by CRA. Some receive fines while others are even sentenced to jail time. Here is a quick review of some of the individuals and businesses prosecuted by CRA in October 2013.
- A professional engineer in Thunder Bay, Ontario, was convicted in October of tax evasion. CRA’s investigation found that this taxpayer had failed to report income on his 2005-2009 tax returns. He was fined more than $84,000, representing 100% of the total taxes evaded and sentenced to 5 months of house arrest. He still has to pay the taxes and the interest and the civil penalties.
- In Kamloops, British Columbia, a man was convicted of tax evasion for failing to file his 2002 and 2003 personal income tax returns. He was fined $5,000 and sentenced to 60 days in jail to be served on weekends.
- In Prince Edward Island, a university professor was convicted of tax evasion for failing to report income received in 2009 and 2010. The taxpayer was fined $30,212 which has to be repaid within 12 months or he could be sentenced to serve up to a year in jail.
- A Brampton, Ontario couple was convicted of tax evasion in October for failing to file corporate and individual tax returns. They were fined over $13,000 collectively.
- In London, Ontario, a chartered accountant and former executive of a tool and moulding company was convicted of tax evasion. He was fined over $80,000 in addition to penalties and interest for failing to report income and benefits received from a former employer.
- In Guelph, a construction worker was convicted of tax evasion and fined $3,000 for failing to file his 2009, 2010 and 2011 personal income tax returns.
As you can see, it is quite common for people to fall behind filing tax returns or to fail to report income (sometimes they know, sometimes they don’t, sometimes they simply received bad advice from an accountant). It is also quite common for CRA to pursue a criminal conviction that includes fines and even jail time in addition to the penalties and interest that will be assed once a debt is determined.
It is far better to get to CRA before they get to you because there are programs that can be used by a professional acting for you so that you can avoid penalties and prosecution entirely.
For more information about what you can do if you are behind filing tax returns or have undeclared income please visit www.taxsolutionscanada.com or call 1-888-868-1400.