CRA Takes Action To Enforce Canadian Tax Laws

by Mike Godfrey, for LawAndTax-News.com, Washington

07 April 2009

The Canada Revenue Agency (CRA) has announced that it is using a variety of tools and methods to identify non-compliance and take action to address tax cheating, as well as to correct honest mistakes.

According to the CRA, commitment to promoting the integrity of the tax system is expressed through a wide range of compliance activities.

In 2007-2008, the CRA:

• obtained more than 761,000 tax returns from individuals and corporations who had failed to file;
• made over 1 million adjustments to individual tax returns after comparing the information reported by taxpayers with data filed by third parties, such as employers;
• conducted over 350,000 audit and review actions, including about 17,300 underground economy audits, and more than 1,100 audits of taxpayers suspected of earning income from illegal activities;
• identified a total dollar value of CAD5.7bn (USD4.6bn) in non-compliance for international and large business and CAD2.1bn (USD1.7bn) for small and medium sized enterprises;
• reviewed nearly 4,000 businesses to ensure they were maintaining proper books and records;
• undertook legal action that resulted in the conviction of 1,296 taxpayers who had not filed tax returns or not registered for goods and services tax/harmonized sales tax (GST/HST);
• referred 243 income tax and GST/HST criminal investigations for prosecution. Of the prosecution cases completed in the past year, 96% resulted in convictions;
• contacted close to 11,000 small and medium-sized businesses to educate and help them meet their tax obligations;
• reassessed over 20,000 individuals who had participated in one or more of 20 unacceptable tax shelter gifting arrangements; and
• recovered CAD11.9bn (USD6.9bn) through collections activities.

Further to this, the CRA has reminded all taxpayers when they file their 2008 return to be sure to report their income, deductions, and credits accurately.

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