A vast majority of Canadians pay their fair share of taxes, but those who don’t put an increased burden on the rest of us. That is why the Canada Revenue Agency (CRA) has implemented initiatives to help Canadians participate in the efforts to help fight offshore tax avoidance and evasion. The Offshore Tax Informant Program…
The Canada Revenue Agency (CRA) has employed the Informant Leads Line, or “Snitch Line” for a very long time, and with incredible results. Only recently has it been getting a lot of attention in the media. The line has been so successful that the CRA (Canada Revenue Agency) is reducing their workforce – specifically related to investigations – because they get more detailed information through tipsters than they would if they had employees trying to locate this information.
Who uses this line? Still ex-wives and ex-husbands, former business partners and neighbours who have been confided in and either felt compelled to notify the government of the fraud being committed or who were hurt, harmed or cheated by the person who has been committing the fraud and who used this line as their way to ”get even”.
It is important to know should you decide to call the Canada Revenue Agency’s Informant Leads Line that that the CRA takes your privacy VERY seriously and they will never notify the person(s) / organization(s) that you call on that it was you who called their line.
The CRA will cite their “Privacy Notice”, meaning that they regularly collect personal information under the authority of the Income Tax Act (ITA) and the Excise Tax Act (ETA) and they will use that information as the justification for following up on information provided by callers to the Informant Leads Line to determine if there is an element of non-compliance with tax legislation, and if applicable provided to the corresponding compliance program for appropriate enforcement action.
Information provided on this line may also be referred to the Canada Border Service Agency (CBSA) or Human Resources and Skills Development Canada (HRSDC), in the event that the lead relates to one of the programs they administer.
The information provided is voluntary and will not affect any dealings you may have with the Government of Canada / Revenue Canada.
Here are some answers to the most common questions asked of me, relating to the Canada Revenue Agency’s (CRA) Informant Leads / Snitch Line, starting with:
1) When should I call the CRA’s Informant Leads Line:
When there is “Tax Evasion”, which is an illegal practice where a person or business avoids paying taxes or reduces their taxes by misrepresenting their activities.
2) How can I report tax evasion?
Over the Internet (I have linked the CRA page and provided it here in case you’re nervous about clicking the link)
By phone, mail or fax
Phone: 1-866-809-6841 (toll free)
Fax: 1-888-724-4829 (toll free)
Office hours: 8:15 am. to 5:45 pm. (Eastern Time).
National Leads Centre
Business Intelligence & Quality Assurance Division
Canada Revenue Agency
200 Town Centre Court Scarborough ON M1P 4Y3
3) Some examples of tax evasion are:
- not reporting all income
- claiming deductions for expenses that were not incurred or are not legally deductible
- claiming false GST/HST tax credits
- failing to remit source deductions
- providing false information on marital status or children to obtain benefits and credits
4) What happens to the information provided to the CRA?
The CRA diarizes everything and determines if they need to take immediate enforcement action or if they need additional information before moving forward. Either way, you will never be notified as to whether or whether not the CRA took action as they are prohibited from doing so under section 241 of the ITA and section 295 of the ETA.
5) Does the CRA pay for the information I provide?
No. The CRA does not pay for information received from informants. The CRA does now have the Offshore Tax Informant Program (OTIP) which offers financial awards to individuals with information about major cases of international tax non-compliance resulting in more than $100,000 of additional federal tax being assessed and collected. For more information, please visit the OTIP website, including how to make a submission.
6) What do I get for reporting tax fraud?
Well, besides feeling great, you are helping to ensure that all Canadian taxpayers are paying their fair share of taxes and this benefits all Canadians. The CRA will tell you that if everyone pays what they owe taxes might go down… I’m not holding my breath, but you never know.
7) Will the CRA ever reveal who provided the information to them?
Never! However, you can provide them with consent to release your identity, should you want that person(s) / organization(s) to know. The CRA has a legal obligation not to disclose the identity of informants, any information that might disclose an informant’s identity or even information that might reveal the existence of an informant is removed, even in the case where an Access to Information request is made.
8) How can you send information by email?
You can submit general informant information to the CRA using their secure Internet portal. If you want to provide supporting documentation you are best to mail or fax it.
9) Does the CRA really look at EVERY lead, and take them seriously?
10) If I submit a lead, then want to revoke it, is there a way to do that?
11) What stops someone from phoning in a fake lead?
Well, before the CRA is able to take any action, they require more information that just “My ex has a job working for cash.” They would like any or all of the following information to help them prioritize the severity of the tax evasion and whether they need to get more information or get working on it right away, such as:
- names and contact information for the person(s) / organization(s) you suspect
- this can include address, phone, email, and so on
- social insurance number (SIN) / business number (BN)
- date of birth
- spouse’s name
- business name
- names of shareholders if a corporation is involved
- related companies
- type of fraud you suspect:
- income tax (personal – T1 or corporate – T2)
- provincial tax (PST)
- fraudulent refunds
- Canada Child Tax Benefit (CCTB)
- Universal Child Care Benefit (UCCB)
- details of your observations
- documents: have you seen these documents? Do you know where they’re kept?
- does the person deal in cash only? Do you know what they do with the cash?
- net worth information, such as assets, including those outside Canada (cash, name and address of banks, house, land, cottage, vehicles, boats, etc.)
- liabilities (loans, mortgages, credit cards, etc.)
- personal expenditures (food, housing, trips, restaurants, hobbies, etc.)
- your name and phone number (this is optional)
The CRA will ask you if they can contact you if they require more information. That is up to you.
If at any point, the CRA determines this information is incorrect, fabricated or provided to them for the purposes of committing fraud, not only will they indicate the details on your permanent diary record, but they will also take actions against you.
Once you have submitted a lead to the CRA, it’s good to have an understanding of the fines and/or penalties which can be levied upon the individual / organization, as they can be as high as 200% of the taxes which were attempted to have been evaded.
In addition, the CRA publishes the results of its prosecution activities on its Convictions Web page.
Of course, if you have found yourself to be in violation of any of these requirements and are worried that the CRA will find out, or that someone will call the snitch line on you, you should contact us and we can begin to discuss the steps to help you which may or may not include the CRA’s Voluntary Disclosure Program.
It is ALWAYS better to get to the CRA before they get to you!