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Canadian
Businesses Warned Against Using Tax Cheating Software
December 10, 2008.
The Canada Revenue Agency (CRA) is aware that electronic sales suppression
software is currently being marketed and sold to Canadian businesses.
Business owners are reminded that hiding income to evade taxes is against
the law. Using this software is not worth the risk.
Electronic sales
suppression software is designed to work with point-of-sale systems and
electronic cash registers. Businesses use the software to delete a portion
of sales from their computer records to evade payment of income and sales
taxes. In some cases, restaurant owners who suppressed sales using this
software have collected taxes from patrons and not remitted them to the
CRA as required by law.
The CRA has over
5,000 employees dedicated to finding unreported business income and
ensuring that the proper amount of taxes is paid, even when sales records
are missing.
The CRA is working
to identify those who develop, sell, or use the software. Businesses that
have used electronic sales suppression software are suspected of having
hidden thousands of transactions and millions of dollars in sales. Once
caught, these tax cheaters will face penalties, court fines, and possibly
even jail. They will also have to pay the taxes they tried to evade, plus
interest.
Although customers
may not notice if a business is using electronic sales suppression
software, they can do their part to ensure tax compliance by always
requesting a copy of their receipt. Businesses which evade taxes are
placing an unfair burden on the individuals and other businesses that
accurately report their income and pay the taxes they owe.
If you have been
using electronic sales suppression software and wish to come forward, you
can do so through the CRA's
Voluntary Disclosures Program. If
you make a full disclosure before any compliance action or investigation
is started, you may only have to pay the taxes owing plus interest, and
you will not face penalties or prosecution in the courts. For more
information on the program, go to
www.cra.gc.ca/voluntarydisclosures.
If your business
has been contacted about electronic sales suppression software, or you
have information which could help the CRA identify those who develop,
sell, or use the software, you are encouraged to report them. Go to
www.cra.gc.ca/investigations and
select Contact Us to find contact information for your local Enforcement
Division.
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