Is Somebody Being Paid Through OTIP About Your Offshore Investments

Is Somebody Being Paid Through OTIP About Your Offshore Investments
In several posts we have talked about the CRA’s measures for cracking down on tax evasion through Offshore investments. Back in the spring of 2013 the Harper Government announced that they were going to put several steps in place to crack down on tax evasion and aggressive tax avoidance. Now included in these steps is the launch of the CRA paying anyone who brings them information about potential tax evasion regarding offshore investments. The new program is called OTIP


If the information is acted on and the results of the assessment is more that $100,000 minus interest and penalties then the tax informant will receive a sum of money, but only after the tax has been collected and all recourses of the tax evader has expired. The information giver would receive a sum of money.


Of course there are all kinds of rules and regulations that are attached to this new program. Some of them include the criteria in which an individual has to meet to be eligible for an informant’s payment. For example, an individual that was party to the tax evasion he/she was reporting would not be eligible for payment, but you can bet the CRA would be more than happy to accept any information the person was willing to give.


This program is also open worldwide. So an informant does not have to be from Canada but again there are regulations attached to this as well.
These are just a few of the many criteria that must be met under this new snitch legislation.


While this is a good program in some ways it also has an air of danger about it. No doubt many attempts will be made by individuals to use the snitch system has a way to get back at someone they have a grudge about. Think about all the disgruntled employee’s that may potentially see this as a way to create real hassles for their previous employers. Or business partners who have separated on a bad note.


The informant is going to have to give his or her actions some serious thinking. The motives may be merely because it is the right thing to do, but more often than not it will either be for the potential payment they will receive, or merely retribution as a result of a grudge. While the CRA claims they will do whatever they can to protect the identity of the informant they have made it clear that if this individual is needed to testify in court then they will have to do so.


Don’t put yourself in a precarious situation. Make sure you are meeting your tax obligations for foreign investment by having me as your Toronto accountant to tend to your tax filings the right way.


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Sam Seidman, CPA, CA, LPA
629 Sheppard Avenue West
Toronto, Ontario
M3H 2S3

Telephone: (416) 398-1700
Fax: (416) 398-6226

Chartered Professional Accountant, Chartered Accountant, Licensed Public Accountant


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