When the 2013 budget was released this past March, there was
a new measure put in place to help the government find major tax cheats.
There is already a snitch line for people to call and get
someone audited, but this new line is directly aimed at individuals hiding
amounts abroad and this time, the CRA is willing to pay for results.
If an amount over $100,000 is recovered by the Canada
Revenue Agency as a result of your tip, you will be REWARDED BY THE GOVERNMENT
WITH 15% OF THE FUNDS COLLECTED
.
And there are many people out there that would call on their
neighbours, ex-spouses, ex-business partners, former employers or that person
who is always taking weekend trips to the Bahamas.
If the prospect of someone calling the government on you
scares you, it should. There are huge penalties and interest associated with
under-reporting your income. Even if you are not earning any income on your
overseas money, you still will be hit with severe penalties if you had not
submitted a T1135 Foreign Income Verification Statement with each annual tax
filing.
There is also the possibly to be charged with a gross
negligence penalty or even criminal prosecution.
Once the CRA is alerted to your activities, you are caught.
If you decide to come forward and declare this income before
the government finds you, you may be eligible to file a Voluntary Disclosure
which will waive the penalties and any criminal prosecution. You will still owe
taxes on any foreign income earned, but without the penalties the amount will
be greatly reduced.
The Government, and governments, (all parties) have backed-off on the income tax and switched to a revenue system based on employment taxes, sales taxes, fines, and 2013 tax brackets. If you look at the big picture, both parties want more of your money. Who knows, maybe they deserve it.
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