Under the Canada Income Tax Act,* most disputes are processed administratively through assessments and re-assessments. If a taxpayer disagree with the Minister’s assessment, the taxpayer may institute a civil proceeding before the Tax Court. These proceedings are civil in nature and generally don’t result in imprisonment, unless the taxpayer is prosecuted criminally.
As it turns out, unlike its US counterpart, the Canada Revenue Agency doesn’t conduct criminal prosecutions. Criminal prosecutions under the Act are referred to the Department of Justice, which considers criminal charges based on evidence.
The offcences that may result in criminal prosecutions are listed in sections 238 to 243 under the Act. Below is a partial list of the offences:
- failing to file or make a return
- false or deceptive statements
- destruction of records
- false entries
- evasion of tax
- conspiracy to commit an offence
Penalties range from a fine to a jail term not exceeding 5 years.
Don’t do the crime or you’ll pay the fine (or do the time).
*R.S.C. 1985, c. 1 (5th Supp.)
Note: Please keep in mind that this article is provided for information and educational purposes. It does not constitute legal advice and should not be regarded as such. The law may have changed since the publication of the article.
PSWLaw represents clients on tax-related matters.
