Canada Revenue Agency

Canada Revenue Agency

October 19, 2012 09:53 ET

Canada Revenue Agency: Toronto Tax Preparer Jailed for Tax Fraud Scheme

TORONTO, ONTARIO--(Marketwire - Oct. 19, 2012) - The Canada Revenue Agency (CRA) announced today that on October 17, 2012, Ms. Penelope Donick was sentenced to one year in jail and fined $200,000 for tax fraud. Donick was given five years to pay the fine, or serve an additional two years in jail.

Penelope Donick of Toronto pleaded guilty on June 18, 2012, in the Ontario Court of Justice in Toronto, to one count of fraud over $5,000.

The CRA discovered that 269 false income tax returns where filed by Ms. Donick and her clients for the 2005 to 2008 tax years. A total of $4,068,900 in false charitable donation deductions was included on these fraudulent returns, reducing the amount of federal taxes owed.

A CRA investigation revealed that Ms. Donick, operator of a tax preparation business, sold false charitable donations receipts of various amounts to 133 clients for a fee. She then used these charitable donation receipts to prepare some of her clients' income tax returns, and submitted false receipts along with the returns to the CRA.

"Canadian taxpayers must have confidence in the fairness of the tax system," said Vince Pranjivan, Deputy Assistant Commissioner, Ontario Region, CRA. "To maintain that confidence, the Canada Revenue Agency is determined to hold tax evaders accountable for their actions."

The information in this news release was obtained from the court records.

Taxpayers who claim false expenses, credits or rebates from the government are subject to serious consequences. They are liable not only for corrections to their tax returns and payment of the full amount of tax owing, but also to penalties and interest. In addition, if convicted of tax evasion, the court may fine them up to 200% of the tax evaded and sentence them for up to a five-year jail term.

Taxpayers who have not filed returns for previous years, or who have not reported all of their income, can still voluntarily correct their tax affairs. They may not be penalized or prosecuted if they make a valid disclosure before they become aware of any compliance action being initiated by the CRA against them. These taxpayers may only have to pay the taxes owing, plus interest. More information on the Voluntary Disclosures Program (VDP) can be found on the CRA's Web site at www.cra.gc.ca/voluntarydisclosures.

Further information on convictions can also be found in the Media Room on the CRA website at www.cra.gc.ca/convictions.

Contact Information

  • For media information:
    Canada Revenue Agency
    Peter Delis
    Manager, Communications
    (416) 952-8044