Anthony McPhail, formerly of Chatham-Kent, was sentenced earlier this week in the Ontario Court of Justice in Chatham, to 18 months in jail and a fine of $323,402.
On February 9, 2015, McPhail pleaded guilty to two counts of evading income tax and four counts of making or participating in the making of false statements in the income tax returns of individuals to obtain or claim unwarranted tax refunds under the Income Tax Act.
The fine represents 100% of the federal income tax evaded.
A Canada Revenue Agency investigation revealed that McPhail, a tax preparer and proprietor of Valet Vending Services, created a scheme whereby he advised his clients they could make money by buying and reselling chocolates to benefit charities.
The CRA investigation revealed that no charities benefited from these sales.
McPhail then prepared income tax returns for the 49 participating individuals, claiming fictitious business losses.
In total, McPhail prepared 118 tax returns, claiming $3,840,788 in fictitious losses for the 2006 to 2009 taxation years.
As a result, $231,599 in income tax was evaded.
The investigation also revealed that McPhail failed to report as income the percentage of the tax refunds he received from his 49 clients.
McPhail thus evaded the payment of $91,803 in federal income taxes.
The preceding information was obtained from the court records, Canada Revenue Agency officials stated.
“Our taxes pay for the high level of government services that Canadians count on,” said Vince Pranjivan, assistant commissioner of the Ontario Region. “When someone tries to evade taxes, it affects all Canadians.”
Taxpayers convicted of tax evasion may be fined up to 200% of the taxes evaded and face jail terms of up to five years.
If you have ever made a tax mistake or omission, the CRA is offering you a second chance to make things right through its Voluntary Disclosures Program (VDP).
If you make a valid disclosure before you become aware that the CRA is taking action against you, you may only have to pay the taxes owing plus interest.
More information on the VDP can be found on the CRA’s website at www.cra.gc.ca/voluntarydisclosures.
