CRA pursues real estate tax cheats to the tune of $1 billion

real estate tax evasion

real estate tax evasion
Photograph By Getty Images

Since the Canada Revenue Agency (CRA) starting cracking down on real estate tax evasion in 2015, more than $1 billion dollars in tax revenue has been recovered, the CRA announced May 30.

Most of this income came from more than 34,000 audited files in Ontario, adding more than $600 million to federal coffers over the past four years. Nearly two-thirds of that revenue came from audits of GST or HST rebates on the purchase of new-build homes.

In B.C., audits of 7,400 files identified more than $422 million in unpaid taxes related to real estate, most of which was from under-reported income. The CRA added that the amount of unpaid tax identified during that period has increased significantly each year.

The CRA promised an even tougher crackdown with the launch of a new Real Estate Task Force, paid for by funds set aside in the 2019 Federal Budget.

It said in a statement, “Budget 2019 proposes to further increase compliance actions by providing $50 million over five years and $10 million ongoing to create a Real Estate Task Force that will focus initially on the Greater Toronto and Greater Vancouver areas, following the risk as it evolves over time. This will have a direct impact in deterring tax non-compliance in the real estate market. The additional taxes also support the social programs administered by the federal government that benefit all Canadians.”

The CRA said the Real Estate Task Force will focus on ensuring that:

  • taxpayers report all sales of their principal residence on their tax returns;
  • any capital gain derived from a real estate sale, where the principal residence tax exemption does not apply, is identified as taxable;
  • money made on real estate flipping is reported as income;
  • real estate commissions earned are reported as taxable income; and
  • builders of new residential properties remit the appropriate amount of GST/HST to the CRA.

Diane Lebouthillier, federal minister of national revenue, said in the statement, “The Government of Canada is committed to ensuring that Canadians benefit from a strong, stable housing sector. With Budget 2019’s proposed multi-year funding for the CRA’s work on the real estate sector, we will create a new Real Estate Tax Force and increase our efforts to combat non-compliance to better ensure tax rules in the real estate sector are followed by all Canadians.”

The post CRA pursues real estate tax cheats to the tune of $1 billion appeared first on Vancouver Is Awesome.

What do you think?

0 points
Upvote Downvote

Written by admin

Entire top-floor penthouse of Coal Harbour tower listed at $15.5M (PHOTOS)

22 awesome Vancouver food events to check out this June