Penalties

Joern (“John”) Scholz is a former CPA who unfortunately caused havoc for his clients, and their tax matters, before his CPA membership was revoked. John was convicted of convincing a large number of taxpayers to participate in complicated RRSP maneuvers after having persuaded them that everything was legal under the Income Tax Act...

Gross Negligence Penalties are meant to penalize taxpayers for their failure to meet tax obligations such as not reporting income or claiming false credits. If the alleged tax avoidance or evasion is related to GST/HST the penalty is 25%. For income tax, 50% is applied to any balance owing. Technically, to uphold a gross negligence penalty, the...

When taxpayers owe money to the Canada Revenue Agency (“CRA”), the amounts can quickly rise because the CRA charges interest on top of the amount owing. Additionally, if you file late, the CRA will hit you with penalties, and they even charge interest on those penalties. Before you know it the amount you owe could be insurmountable.Interest...

Bulk Taxpayer Relief Requests & Extreme Weather Events Canada Revenue Agency (CRA) released guidance on “bulk” taxpayer relief requests as well as taxpayer relief for “extreme weather events.” CRA makes specific reference to the “unprecedented...

Tax Free Savings Account (TFSA) Penalties CRA Rules for Tax Free Savings Account Investments The TFSA can be an effective investment and tax savings vehicle. In general, gains in the account remain tax free. However, there are very strict rules regarding...

CRA Gross Negligence Penalty What is a Gross Negligence Penalty? The Canada Revenue Agency (CRA) routinely applies gross negligence penalties following an audit. The financial penalty can be as high as 50% of the tax owing. If a CRA auditor has increased taxable income, a gross negligence penalty...