Enforcement Notification - Vaughan-area general contractor who used GST/HST charged to clients for personal expenses is fined for evading taxes and withholding GST/HST

NEWMARKET, ON, Jan. 15, 2020 /CNW Telbec/ - The Canada Revenue Agency (CRA) announced that Gilles Larocque (Larocque) of Nobleton, Ontario pleaded guilty to tax evasion. He was sentenced in the Ontario Court of Justice in Newmarket and fined a total of $301,125. Larocque pleaded guilty on January 7, 2020, in the Ontario Court of Justice in Newmarket, Ontario to two counts of failing to report income by not filing income tax returns, thereby committing tax evasion under the Income Tax Act. He also pleaded guilty to two counts of failing to remit goods and services tax/harmonized sales tax (GST/HST) under the Excise Tax Act.

A CRA investigation revealed that Larocque, who owned and operated a construction company in the Vaughan, Ontario area, provided general contracting work to clients that included dry walling, framing and ceiling tile installation for gas stations. Larocque used several aliases and business names and charged clients for GST/HST, which he used for his personal expenses. Larocque failed to report income in both 2013 and 2014 tax years and evaded a total of $180,401 in federal taxes. He also failed to file GST/HST returns in both those years, totalling $120,724 in unremitted GST/HST. The total amount of federal tax evaded and unremitted GST/HST for the years 2013 and 2014 was $301,125.

All case-specific information above was obtained from the court records.

Wilfully failing to follow tax laws could result in serious consequences, including reassessments, the imposition of civil penalties and criminal tax investigations and prosecutions resulting in the imposition of court fines, jail time and a criminal record. When taxpayers are convicted of GST/HST tax evasion, they must still repay the full amount of taxes owing, plus interest and any civil penalties that may be assessed by the CRA. In addition, the court may fine them up to 200% of the taxes evaded and impose a jail term of up to five years.

The Voluntary Disclosures Program (VDP) gives you a chance to correct inaccurate or incomplete information, or disclose information not previously reported in a tax return you previously filed or to file a return that you should have filed. If you file a VDP application and it is accepted by the CRA, you will have to pay the taxes owing. However, you will also be eligible for relief from prosecution and, in some cases, from penalties and some of the interest that you would otherwise be required to pay. For more information, go to Canada.ca/taxes-voluntary-disclosures.

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SOURCE Canada Revenue Agency