CRA Announces Tips To Help Protect Against Tax Preparer Fraud

by Mike Godfrey, Tax-News.com, Washington

13 March 2008

With Fraud Prevention Month in full swing, the Canada Revenue Agency (CRA) on Tuesday warned taxpayers to stay away from return preparers who offer false tax deductions such as inflated charitable donations, child care expense claims, or even business expenses or losses.

The CRA explained that: "While most preparers provide excellent service to tax filers, a few unscrupulous ones file fraudulent tax returns—and in the end it's the client who pays."

The Revenue Agency further warned individuals to remember that even if someone else prepares their tax return, they are responsible for all the information on the return.

The CRA went on to outline some of the measures that can be undertaken by taxpayers to ensure that the information on a tax return is correct. These included:

1. Making sure that they are aware of who they are dealing with at tax time and what the preparer's credentials are;
2. Ensuring the tax preparer will be providing a copy of the return for the taxpayer's records; and
3. Never signing a blank tax form.

The tax authority went on to state that:

"The CRA takes abuse of Canada's tax laws very seriously. Tax fraud places an unfair burden on law-abiding taxpayers and businesses, and it jeopardizes the integrity of Canada's tax base."

It concluded: "If a tax preparer is offering you fraudulent tax preparation services, individuals can report it anonymously by contacting the Canada Revenue Agency's Enforcement Division at your nearest tax services office."

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