January 13, 2010 by Dan White.

January had hit the world with a renewed assault by CRA on Canadians across this land. Audit and tax problems are becoming a part of everyday life for small business in Canada.

It is not just tax cheaters they are after,,, they are after anything that they can attack.

Every Canadian needs to learn how to protect themselves from what is coming from CRA.

To learn more about taxes and tax problems, go to www.taxauditsolutions.ca

Dan White

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Taxman has eye out for cheaters, by the Cochrane Report

As income tax time moves closer, the Canada Revenue Agency has begun its annual campaign to warn cheaters about the trouble they could be in, and how they can use the Voluntary Disclosures Program.

The CRA says it is aggressively addressing non compliance. Last year, the agency 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.

The CRA completed 20,750 international audits and 34,111 audits of tax shelters. The CRA identified a total dollar value of $5.7 billion in non”‘compliance for international and large business and $2.1 billion for small and medium-sized enterprises.

The CRA reassessed over 20,000 individuals who had participated in at least one of 20 unacceptable tax shelter gifting arrangements.

The CRA completed 148 interprovincial tax avoidance cases, which resulted in more than $300 million worth of taxes being recovered.

“These accomplishments led to results in the courts, including significant fines and — for some people — jail time,” the agency said this week.

The CRA is a member of international organizations that work to tackle the abusive use of tax havens. International partnerships help us uncover schemes that are developed abroad and marketed in Canada. Taxpayers with unreported assets and income offshore could face penalties of up to 50 per cent of unreported tax on income and five per cent per year for any unreported assets.

The agency says taxpayers who have not reported all of their income can voluntarily correct their tax affairs. They will not be penalized or prosecuted if they make a valid disclosure before they become aware of compliance actions being started by the CRA against them. These individuals may only have to pay the taxes owing, plus interest. More information on the VDP can be found on the CRA Web site at www.cra.gc.ca/voluntarydisclosures.

* The Cochrane Report appears each Wednesday and Saturday. Items for publication may be submitted by e-mail to cochrana@timestranscript.com, or by fax to 859-4904.

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January 13, 2010 by Dan White.

This is not one of our cases, but it is a terrible injustice Audit Horror Story.

For more information on audits and how to prevent tax problems in Canada, go to www.taxauditsoluitons.ca

British Columbia’s Mr. Irvin Leroux, who has lost everything fighting for 14 years against such bully tactics by the CRA
Audit Nightmare As Published in Canada Free Press
By Kevin Gaudet  Wednesday, January 13, 2010

Imagine the Canada Revenue Agency (CRA) shows up at your door to do an audit.  As if that alone isn’t scary enough, they proceed to take both copies of your documents, originals and photocopies —without your permission.

They lose or destroy these key originals. Then they assess hefty tax bills against you because you cannot provide documents in your defense.  CRA mistakenly demands you pay $800,000 in taxes allegedly owed.  This helps ruin your business, leaving you broke. Does this sound far-fetched?  Not according to British Columbia’s Mr. Irvin Leroux, who has lost everything fighting for 14 years against such bully tactics by the CRA.

His treatment outraged his MP, the long-serving Dick Harris, who took up his cause with the former Minister of National Revenue. According to Mr. Leroux, his MP was told by the Minister that the CRA couldn’t pro-actively compensate Mr. Leroux for his loss, but that he could sue the government and they would offer a settlement.

As ridiculous as it is that Mr. Leroux has been forced to sue the Canadian government to get back some or all of what he has lost in his lengthy tax fight fiasco, not a nickel has been offered. In this case it appears the federal government made a mistake; a big one at that. They should just admit it, apologize for it, and settle out of court with Mr. Leroux. Instead, they are playing the Goliath against his David, fighting him in court and denying any wrong-doing on their part.

The latest tactic employed by government lawyers, scheduled for court at the end of this January, has been to argue that Leroux’s lawsuit has no merit as his tax case was resolved earlier.

The issue of taxes owing was resolved by a judge only after Leroux fought in tax court to prove he owed no money. The case was settled in 2005 with the CRA agreeing that he had actually overpaid his taxes. They were required to pay him a small refund.

The CRA’s attitude seems to be ‘oh well, this issue is over.’ But it isn’t over for Mr. Leroux who is struggling to pick up the pieces after CRA’s withering 14 year campaign against him.

Their campaign against him drained him of cash, aggravated by the expense of legal and accounting fees and triggered a domino effect. Mortgagees began foreclosing, and Leroux’s properties were sold off for one-third of their value. When the dust settled, the creditors were paid, but nothing was left for Leroux. Once he had been comfortably set for a secure retirement. Now he is virtually destitute, living on CPP and Old Age Security. He now has recurring nightmares about being homeless and scrounging for food in garbage cans.

While taxpayers certainly don’t want the government tossing money away unnecessarily, governments must do the right thing to correct its mistakes.

Do Revenue Minister Blackburn and Justice Minister Nicholson really not know what is going on here? Are they really condoning this attack on a tax-paying Canadian? Perhaps they simply have no idea what the government’s lawyers have been doing?

Irvin Leroux is an ordinary Canadian who trusted his government to be honest and decent towards him. He paid taxes like he was supposed to – overpaid, in fact. His government turned on him and has ruined him.

This is a case either of rogue tax collectors or of systemic abuse by the CRA. Taxpayers should hope it is the former; that rogue tax collectors were running amok and made life hell for Mr. Leroux. Why would they do this? Because they can. The powers of our tax collectors are enormous and stacked against the little guy. If you mange to get on their bad side then look out because this case shows what the CRA, when roused, can do to you.

The cabinet ministers involved should instruct their lawyers to negotiate a way out of this shameful episode. It further damages the already tarnished reputation of the CRA, and continues to punish a taxpayer who has already gone through too much.

As the end of the year approaches many people take stock of the year that was and make resolutions for the year to come. If politicians did this they first would realize that there is much work to be done.

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