Category Archives: Tax Investigation

The Civil Consequences of Tax Evasion Canada

People have to think a thousand times before pleading guilty to tax evasion Canada because of the civil consequences they may have to face. It is a general case that tax evasion Canada is followed up by criminal charges and it is accompanied with a civil assessment or the reassessment of taxes. The CRA will be keen to get to the bottom of the reason why the taxpayer was concealing more income than he or she intended to declare.

The basis of the tax evasion Canada charge is the very failure to declare the income earned during the year. The taxes are reassessed depending on the income which is undeclared and it can bring in heavy negligence penalties.

There may be many reasons why a taxpayer may want to plead guilty to a criminal offense like tax evasion Canada. When a taxpayer seeks professional accounting and legal help, he or she is advised as a client when being charged with tax evasion Canada that it is necessary for him or her to understand that a guilty plea would bring in consequences which may include that the plea stands as prima facie or it could be a proof of facts which is equivalent to a reassessment of taxes.

It is important, therefore, for professional counselors, who are representing a taxpayer who is about to plead guilty for tax evasion Canada, to understand that the plea for guilt is actually an admission of the basic elements of the offense. This also applies to a taxpayer who has been reassessed. During a tax evasion trial, the defense may have an agreement concerning relevant facts for the sentence. At other periods, facts could be disputed and the party which is trying to rely on disputed facts will have to prove them. To give an example, a taxpayer may agree that he or she is guilty of tax evasion Canada in a particular year but at the same time, may disagree as to the amount involved of the taxes. In such cases, the defense counsel during the criminal proceedings have to take care in establishing the facts that may be agreed to. At the same time, the adviser in the civil proceedings have to assess carefully what the guilty plea may stand for and what it may not stand for.

Before understanding the reasons that contribute towards tax evasion Canada, it is important to take a look at the concept of beneficial ownership which is a common law that distinguishes the rights that a person holds with a beneficial interest in property or assets from those who hold such interests legally and in name. The common law that surrounds beneficial ownership is a little complicated but is signifies that when a person holds or owns a property like a house or securities legally, his or her name will be on that property or it will be properly disclosed. But, when a person holds a property beneficially, the said property may not be registered in his or her name and the true owner may remain obscured.

The issue of tax evasion Canada may revolve mainly somewhere around beneficial ownership of private corporations or trusts while also involving ownership of real property. This concept identifies the important roots of the tax evasion Canada problem as it could open the Pandora’s Box to money and tax laundering.

Understanding Tax Evasion vs. Tax Avoidance

Understanding Tax evasion vs. Tax Avoidance

Tax Evasion is illegal; it is the evasion of taxes by taxpayers including individuals and businesses such as corporations. Under tax evasion taxpayers intentionally misrepresent the true income or tax owing status to the tax authorities to reduce their tax liability. Such act may include false tax filing, such as report less income, profits or gains than actual or inflating expenses or deductions. The extent of tax evasion is measured in the amount of unreported income, which is the difference between the reported income and the actual income.

Tax avoidance, on the other hand, is not illegal. It is when taxpayers use tax laws to reduce tax liability. Both tax evasion and avoidance are tax noncompliance in different degree, as they cover activities that intend to play with the tax system, although such classification of tax avoidance is disputable, given that avoidance is not illegal.

Canada Revenue Agency CRA Response to Tax Evasion

The degree of tax evasion depends on several factors, such as the amount of income an individual or a corporation has. Normally, when the amounts involved are minimal, the efforts to evade income tax decline. The extent of evasion also depends on the CRA’s tax administration effectiveness.

CRA has been improving its technology, procedure and staff training to combat tax evasion. CRA also adopted various means to reduce tax evasion and increase the level of tax enforcement. Tax auditors are required to identify tax evaders, collect the taxes interest and penalties and often those evaders become published on mass media or CRA website so they can become examples for their fellow Canadian taxpayers to comply with the tax rules.

Level of Tax Evasion and Punishment

Just like many other countries, Canadian tax authority considers tax evasion a crime, and the guilty party is liable to fines and/or imprisonment. Dishonestly misreporting income in a Canadian tax return is not necessarily considered a crime. It is also a reality that the extent of evasion depends on the severity of punishment for evasion. As long as you have undeclared income you could face penalties or prosecution for tax evasion. The Canadian Income Tax Act Section 238 and 239 set out details on tax evasion and the penalties for tax evasion in Canada.

The offenders who are guilty under section 239 of the Income Tax Act will be subject to a fine of up to double the amount of the tax that was evaded and/or imprisonment for a term not exceeding two years.

Income tax evasion can lead to criminal charge and it is a serious act. It should be avoided at all costs. If you have been hiding for years from the CRA for unreported or under reported income, you may want to consider cleaning up your tax problems voluntarily. With experienced tax professionals’ help, your damage will be greatly reduced. The worst nightmare happens when after many years of hiding, all of sudden CRA starts investigation. You could lose everything overnight. Take risk free action immediately before it is too late. Contact Tax 911 Now, the experienced tax professionals for a private, confidential, free no obligation consultation! Call 1-877-918-2991 today!

Need CRA Tax Audit Help?

Running a business can be a life full of pressure. Customers have demands that need to be met, vendors need to be paid, and problems constantly arise that have to be solved quickly. With everything that goes on during the typical course of a day, it is no surprise that some details slip through the cracks. Unfortunately for many companies, these details often are related to their finances.

The overlooked items may start out small, but over time they compound until the business is faced with major accounting errors. The truly unfortunate part is they may never even realize it until an auditor starts to look through their books. Rather than face a hefty tax bill, use our experts at Tax 911 Now for all CRA tax audit help in Toronto. All businesses may feel they need tax relief of some kind or another, but for those backed into a corner by an impending audit, the feeling of being trapped is even more intense. That is why our professionals at Tax 911 Now are there night and day to give companies the relief they need by offering CRA tax audit help.

Your own CRA tax audit help

The first and most immediate relief our clients experience is finally having representation. They no longer are forced to deal with CRA auditors themselves. At Tax 911 Now, our experts are some of the best in their field for negotiating CRA tax audit help in Toronto and appealing unfair findings. Unfortunately, CRA agents can sometimes exploit a company’s lack of tax knowledge to force it to pay bigger penalties. They even threaten criminal prosecution in some cases. With Tax 911 Now’s CRA tax audit help, these fears quickly fade away for our clients.

You Can Afford It

Once a settlement is reached, our professionals will make sure our clients have a monthly payment plan that fits easily within their budgets. Many of our clients are afraid to come to us because they think their taxes and fees are so substantial that they can never get out from underneath them. They wait until the CRA threatens to lean out their property or freeze their bank accounts. No tax issue is too small or too large to find relief.

You Do Not Have to Get Behind

For further information about Tax 911 Now or to have us start relieving your tax stress, call our professionals at 1-877-918-2991 or visit us at 129 Telson Road, Suite # 100, Markham, Ontario, L3R 1E4. Our experts will be happy to help and provide any CRA tax audit help necessary in Toronto and other cities in Canada. Remember it is never too late to rectify a bad tax situation. The dedication of our staff is second to none, and we will work tirelessly to find answers to any and all of our clients’ problems. Still feeling unsure? Take advantage of our free consultation to begin to find the CRA tax audit help your business needs. Do not let the fear of a tax audit cripple your company, call us today and find relief at 1-877-918-2991.