Canada Revenue Agency - Toronto Tax Services Office

Canada Revenue Agency - Toronto Tax Services Office

January 11, 2005 13:38 ET

CRA: Caledon Pay Consultant Fined $375,000 for Tax Evasion


NEWS RELEASE TRANSMITTED BY CCNMatthews

FOR: CANADA REVENUE AGENCY

JANUARY 11, 2005 - 13:38 ET

CRA: Caledon Pay Consultant Fined $375,000 for Tax
Evasion

TORONTO, ONTARIO--(CCNMatthews - Jan. 11, 2005) - A Caledon consultant
was fined a total of $375,000, on January 10, 2005, in the Ontario Court
of Justice after pleading guilty to five counts of income tax evasion.
The fine represents approximately 200% of the total federal income tax
evaded.

Walter Jefferson, a director of two pay and benefits consulting
companies, failed to report income totalling $646,712 on his 1996 to
2000 income tax returns. A Canada Revenue Agency (CRA) investigation
determined that Mr. Jefferson, director and officer of Canadian Benefit
Consulting Group Inc. and Global Benefit Plan Consultants Inc. and the
majority shareholder of the latter, misappropriated funds from both
companies by fabricating expense claims and invoices for services that
were not rendered. Mr. Jefferson was reimbursed by both companies for
the fraudulent expenses and non-existent services, including goods and
services tax.

"Canadians have to be confident that the tax system is fair," said John
McCallum, Minister of National Revenue. "The Canada Revenue Agency will
use its resources to ensure that the few people who do not pay their
taxes are not penalizing the majority of Canadians who do."

The Income Tax Act provides that an individual's income from an office,
employment, business, property, or other source is taxable. The Income
Tax Act does not distinguish between income from legal or illegal
activities.

When individuals or corporations are convicted of tax evasion, in
addition to any fines imposed by the court, they are still obligated to
pay the full amount of taxes owing, plus interest, as well as any
penalties that may be assessed by the CRA. On summary conviction, a
person is liable to a maximum penalty of a fine of 200% of the income
tax evaded and a two-year jail term.

Individuals or corporations who have not filed tax returns for previous
years, not reported all their income, or claimed fraudulent refunds, can
voluntarily correct their tax affairs. They will not be penalized or
prosecuted if they make a full disclosure before the CRA starts any
action or investigation against them. These corporations and individuals
will only have to pay the taxes owing, plus interest.

To take advantage of the voluntary disclosure policy, clients served by
the Toronto Centre Tax Services Office can call (416) 954-5779 or visit
the CRA website at www.ccra.gc.ca for more information.

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