It has now been over a year since the Panama Papers were leaked and hundreds of Canadian taxpayers were named, their tax avoidance schemes exposed. Since that time, tired of the criticism of being soft on tax crime, the Canada Revenue Agency has stepped up their efforts to catch those who dodged their tax obligations. The Panama Papers has become the stick to the proverbial camel.
As a recent Toronto Star article has stated, those named in the Panama Papers are not going to have an easy time. The CRA has become far more aggressive in an attempt to crack down on tax cheats.
Following the leak, the Liberal government announced that it would be providing an almost $500-million investment to support and strengthen CRA tax enforcement. It has also made a move to fingerprint anyone charged with tax evasion in the future.
They’ve even disallowed access to some of the usual resources Canadians have at hand: “Tax fraudsters identified in the Panama Papers will not be allowed to clear their name by declaring their hidden assets and paying back taxes and interest, a process called voluntary disclosure.”
The Voluntary Disclosure Program has long been an important resource for Canadians looking to amend previously incorrect filings, but it isn’t going to help any involved with the Panama Papers leak.
The impacts of such changes are already visible. While the total number of tax evasion convictions has dropped, the fines imposed have jumped significantly (from an average of $46,000 to $123,000 for each offender), and sentences are up as well, from an average of 18 months in 2011-12 to 26.5 months this year.
You can find the Toronto Star article in full here: https://www.thestar.com/news/canada/2017/03/20/panama-papers-have-helped-fuel-a-more-aggressive-cra.html.
While the primary target for this increase in CRA enforcement may be those identified in the Panama Papers, it has also resulted in an overall increase in risk for anyone involved with any form of tax evasion. This means that it is critical to explore any avenues available to amend/revise those originally incorrect statements while you still have the ability to do so. The Voluntary Disclosure Program may be closed for those named in the Panama Papers, but it is still open to those willing to disclose other dealings. Don’t wait until it is closed to you too.
If the increased aggression on behalf of the CRA has you worried, call Tax Solutions Canada today. We can help you deal with your tax issues. 1-888-868-1400.