Rotfleisch & Samulovitch P.C.

"If you claim the [GST/HST] new home tax rebate and the CRA says you are not entitled to it, that’s in all likelihood not going to be fraud," says David Rotfleisch, Taxpage's managing partner. Rotfleisch & Samulovitch P.C.'s managing partner, David Rotfleisch, was recently interviewed by Ruby Mezetta of Investment Executive, a top trade publication for financial advisors in Canada, on the new housing rebate and the government's new housing plan. "Certainly, in Ontario, they seem to be focused a lot on the new housing [rebate],” David said while speaking on the new home tax. He said the government's use of the term “fraud” in its housing plan announcement was “designed to create an impact” but that it was inappropriate for describing legitimate disputes between taxpayers and the CRA. When he was asked about what should be considered fraud in the new home tax, Rotfleisch said, "If somebody renovates [a property], sells it, makes a profit, and doesn’t declare the income, of course, that’s fraud,” he further said, “but if somebody claims the [GST/HST] new home tax [rebate] and the CRA says they’re not entitled to it, that’s in all likelihood not going to be fraud." Inadvertent is the opposite of fraudulent; plus, there is no intent to deceive. David advised that taxpayers should seek professional advice to protect against a possible audit. He opined that if a lawyer provides an opinion that a real estate transaction is on the side, a client’s risk is mitigated. “Get a memo in a file; once you have that, there’s almost no chance of [CRA successfully applying] gross negligence penalties, and you’re going to know what the recommended [tax] treatment is [for the real estate transaction],” advised Rotfleisch. To read the entire interview, here's the link: https://lnkd.in/gYwFdEHb Are you facing an audit by the CRA? Our team of experienced tax lawyers is here to help you navigate through it. To stay up-to-date on major tax developments in Canada, follow our social media pages or call 416-367-4222 for a 10-minute consultation on Canadian income tax. Send us an email at info@taxpage.com. Taxpage.com All the tax help you need. Disclaimer: Posts on this page are for educational purposes only and shouldn't be taken as tax or legal advice. For legal advice, please consult your lawyer. #Taxpage #Newhomerebate #HousingCrisis #Realestate #Canada #Taxlaw

Capital loss v Business loss: options available to Canadian victims of cryptocurrency scams Cryptocurrency scams, such as ‘pig butchering’ are on the rise. They involve scammers creating fake online personas to lure unsuspecting victims into fraudulent cryptocurrency investment schemes. Many Canadians unfortunately fall victim to this sophisticated scam and are often left with the choice of claiming either capital or business losses. Below, we provide 7 guidelines to help with the choices victims of this scam are faced with: 1) To determine if a Canadian victim of a pig butchering scam will be eligible to claim a business loss, several factors such as transaction frequency or volume, length of ownership, to name but a few, will be considered. 2) Business losses are deductible against non-capital income, i.e., a victim of a pig butchering scam who satisfies the above factors will be allowed to claim 100% of the loss they incurred. 3) Ultimately, the taxpayer's motive or intent when acquiring the cryptocurrency is the most important criterion that courts consider when determining whether the transaction produced a business income. 4) Whereas for a victim to claim capital loss, they can be considered to have involuntarily disposed off their crypto properties at the proceeds of disposition of zero dollars and claim half of the cost as capital losses, i.e., on the theft or scam of their crypto, they can claim 50% as capital loss. 5) However, the problem with this approach is that victims of this scam may need to wait for two years to claim the losses if there is no compensation from a third party or tribunal. 6) Ordinarily, many Canadians would lean towards claiming a business loss in such a situation. The dilemma, however, is that there were no real transactions on the fake websites to which they subscribed to the fraudulent crypto investment scheme. 7) Hiring the services of an experienced Canadian cryptocurrency tax lawyer would help provide a clearer path to a resolution. Recently, the Taxpage team helped a real estate agent who lost $1.9 million (USD) in a pig butchering scam to determine the Canadian crypto tax deductions available in his circumstances. To learn more about the tax deductions available to a victim of a pig butchering scam, here's an article link: https://lnkd.in/decZab-8 Don’t know what a pig-butchering scam is? Here’s an article link: https://lnkd.in/dZ3CxUUJ giving details. Are you a victim of the pig-butchering scam? Our team of experienced Canadian crypto tax lawyers will be happy to help. Call 416-367-4222 for or Email: info@taxpage.com. Taxpage.com All the tax help you need. Disclaimer: Posts on this page are for educational purposes.

5 reasons why the CRA may choose to audit you Every year, the Canada Revenue Agency (CRA) conducts over 350,000 audit and review actions; about 15,000 of these audits are targeted at "cash-only" businesses that are part of the underground economy. The purpose of a tax audit is to assess whether the taxpayer has paid the correct amount of taxes and to address any errors, omissions, or potential tax evasion. The CRA may choose to audit a taxpayer for several reasons: 1. Random selection  2. Tips from external sources 3. Comparison of reported income to that of other taxpayers in your neighborhood 4. Targeted audits for those in home renovation, food service, or cryptocurrency trading. And; 5. Cross-referencing your return data with external sources or a past history of non-compliance. To learn more about these audits and how they play out, here's an article link: https://lnkd.in/d9bsSEN5 written by an experienced Canadian tax lawyer. Are you being audited by the CRA? Our team of experienced tax lawyers can help you through the process. Send us an email at info@taxpage.com. To stay up-to-date on major tax developments in Canada, follow our social media pages or call 416-367-4222 for a 10-minute consultation, so you don't have to navigate the T3 trust return alone. Send us an email at info@taxpage.com. Taxpage.com All the tax help you need Disclaimer: Posts on this page are for educational purposes only and shouldn't be taken as tax or legal advice. For legal advice, please consult your lawyer. #Taxpage #CRATaxAudit #TaxSeason #Torontotaxlawyer #Canada

Car thieves, fraudsters, and drug dealers, among others, are not exempt from paying tax in Canada In Canada, illicit earnings from theft, crypto scams, and drug sales, among others, are taxable. According to the Canada Revenue Agency (CRA), 834 audits on illegal earnings occurred during the 2010–2011 period, uncovering an extra $87 million in owed taxes. As with many illegal businesses, proper documentation is not done; thus, the CRA usually conduct tax audits to determine the tax owed. Here are 7 facts about how the CRA runs audits, taxes, and penalties on illegal businesses: 1) The Canada Revenue Agency (CRA) is impartial regarding how income is acquired or the nature of the business or activity. Its job is collecting taxes as per Canadian tax law. The job of prosecuting criminals falls to the justice system and police. 2) Business expenses from illegal businesses can be tax-deductible. The problem with this is the lack of proper records for such businesses. The Tax Court of Canada case of Chronis v. The Queen exemplified this shortcoming when the CRA assumptions resulted in gifts the taxpayer had received being improperly included in the CRA’s tax assessment. 3) The Royal Canadian Mounted Police (RCMP) can provide evidence of illegal earnings to the CRA, which could be used as documentary evidence in tax court against an illegal business owner. This was done in the Tax Court case of Mahmood v. Queen, the RCMP. 4) The Illicit Income Audit Program is the special arm of the CRA that is tasked with identifying and auditing income from illegal activities through special enforcement audits. They do not require convictions or charges before the commencement of a tax audit on such a taxpayer. 5) If this audit leads to more than the tax owed, the CRA may apply gross negligence penalties, which are usually 50% of the tax owed. 6) Also, the CRA may charge the taxpayer under Section 238 of the Income Tax Act for failure to file a return or comply with tax laws, resulting in fines ranging from $1,000 to $25,000 upon summary conviction. 7) Lastly, a tax evasion charge could be brought against the taxpayer under Section 239 of the Income Tax Act, which imposes fines of 50% to 200% of evaded taxes and up to 24 months' imprisonment for tax evasion attempts. To learn more about the intricacies of illicit business, here's an article link: https://lnkd.in/eMm4re6q, written by an experienced Canadian tax lawyer. To forestall a possible CRA tax audit and make your business stand the test of time, our team of skilled Canadian tax lawyers will be happy to represent you and your interests. Send us an email at info@taxpage.com or call 416-367-4222. Taxpage.com All the tax help you need. #Taxpage #Taxlaw #CRA #Canada

 7 interesting Canadian tax facts 1. About 40% of Canadians pay no taxes due to low-income benefits and tax credits, while higher-income individuals reduce their  taxes through allowable deductions and tax credits. 2. Annually, Canadians evade an estimated $40 billion in taxes. 3. Unpaid personal income tax from foreign holdings is estimated at $3 billion. 4. The CRA's estimated annual operating budget for the 2023–24 fiscal year is about $4.13 billion. 5. Owning an offshore account is not illegal, but hiding that account and not paying taxes on it is illegal. 6. "The "Panama Papers" (an offshore financial expose) revealed nearly 900 Canadians linked to offshore accounts, tax sheltering an estimated $76 billion. 7. For most taxpayers, the tax filing due date is April 30, while self-employed individuals have until June 15 (but outstanding taxes must still be paid by April 30). You can get clarity on Canadian taxation with the latest edition of Taxpage.com Canadian Tax Facts 2024, offering comprehensive insights on tax development in Canada and around the world. To download the tax fact document, here's the link: https://lnkd.in/gCtE5gXP Stay updated on tax developments in Canada by connecting with us on social media. For personal assistance, contact us at 416-367-4222 or email info@taxpage.com to schedule a consultation today. Taxpage.com. All the tax help you need. #TaxPage #CanadianTaxFacts2024 #Taxlaw #Canada

"If you don't file your tax on time, you've incurred a 10% penalty for nothing," says David Rotfleisch, Taxpage's managing partner David Rotfleisch, a Canadian tax lawyer and chartered accountant (CA), was recently interviewed by news anchor Ian Hanomansing of CBC’s “The National” on the Top 5 tax tips for Canadians to maximize their 2023 refunds: 1. "It is important to file your tax on time; if you don't, you've incurred a 10% penalty for nothing. Because eventually you're going to file your return, why not file on time? If you file by April 30th [2024], you avoid that immediate 10% penalty, and what happens if you don't owe taxes? You probably get a refund," said David while reacting to a question about his top tax tips for taxpayers. 2. Subsequently, when asked to give a bit of advice on dealing with medical expenses, he said, "The way you claim any medical expenses is for any 12-month period ending in a calendar year; you could claim medical expenses from January 2, 2022, to January 1, 2023. He opined that you have to be on time when you're claiming your expenses. 3. In the same vein, while reacting to a question about whether home workers still get to claim those expenses in their taxes, Rotfleisch said, "You can definitely claim home or office expenses in the right circumstances. Firstly, you have to have Form T22100, which says my employee has to work from home and can claim expenses. In order to claim those expenses, you have to file Form T777, do the calculations of your expenses, and you can claim them. He opined that T22100 and T777 are all pre-COVID rules, which the CRA accepts. To watch the whole interview and learn about his remaining tax tips; kindly click here: https://lnkd.in/dHG_yTe2 and subscribe to our YouTube channel. To stay up-to-date on tax developments in Canada, follow our social media pages or call 416-367-4222 for a 10-minute consultation. Send us an email at info@taxpage.com. Taxpage.com All the tax help you need. #Taxpage #Taxtips #Taxseason #Taxfiling #Canada