Friend's Bank Account Frozen by Revenue Canada - Know a Good Tax Lawyer in Toronto?

[Alon99]

Hi Everyone,

A friend of mine is in a bit of a tax jam... For 6 months in the late 1990's, and from 2001-2005 he did not file an income tax return. He was working freelance, and just kept all the money. Bad move, I know. He's stopped working freelance and is now currently paying tax again.

Yesterday Revenue Canada froze his bank account due to the tax non-payment. Obviously he'd like to sort this situation out sooner than later. What is is best course of action? Contact Revenue Canada directly? Hire a tax lawyer to contact Revenue Canada on his behalf?

If anyone knows of a solid tax lawyer in Toronto who is not too expensive (I have no idea what something like this would cost) please let me know.

Thanks!

Alon

[alexei]

dam I did not know revenue canada has the right to do this kind of stuff. Did your friend get a warning from revenue canada. Revenue canada should have a court order to do this kind of stuff and your friend was probably ignoring them.


If this all happened withouth acknowledgement then thats just wrong my friend.

[Whitedart]

Hi Everyone,

A friend of mine is in a bit of a tax jam... For 6 months in the late 1990's, and from 2001-2005 he did not file an income tax return. He was working freelance, and just kept all the money. Bad move, I know. He's stopped working freelance and is now currently paying tax again.

Yesterday Revenue Canada froze his bank account due to the tax non-payment. Obviously he'd like to sort this situation out sooner than later. What is is best course of action? Contact Revenue Canada directly? Hire a tax lawyer to contact Revenue Canada on his behalf?


Get a tax preparer and get the missing returns filed asap. Once they know he is genuinely acting to get this done, they will back off. The tax preparer can contact RevCan and let them know they have been hired, and give them a time line for submission of the various years to be filed.

If he does not act on this, they will also likely garnashee his wages as well.

He had better hope he does not owe them a lot of money, as there will be significant penalties and interest to pay in addition to the taxes that he owed.

[excel]

is that like tax evasion?

[Whitedart]

dam I did not know revenue canada has the right to do this kind of stuff. Did your friend get a warning from revenue canada. Revenue canada should have a court order to do this kind of stuff and your friend was probably ignoring them.

If this all happened withouth acknowledgement then thats just wrong my friend.

If this goes back to the late 1990s and early 2000s, he would have received a number of warnings. Ignoring them is what has brought the locked bank account about.

I know someone that had similar dealings with RevCan, and that person was receiving warnings and demands to file the returns at least once a month.
It did not get as bad as locking a bank account because it had not extended into 7 plus years, but RevCan had contacted the person's employer to set up a garnashee of the person's pay. The only way to prove the person did not owe as much as RevCan was indicating was to get legitimate returns filed.

[Div]

I've seen many ads from these guys on ROBTv - http://www.taxamnesty.ca/

[JuNGleR72]

How did he get caught?

[ferkel]

who snitched ?

[flito ray]

i recommend that he opens a swiss or bermuda bank account to avoid the pigs.

[cadave]

Hire an accounting firm to back file his taxes... They will usually try to negotiate the best possible results for reasonable fees (that are probably less than a tax lawyer, and just as experienced).

[m85d1]

i recommend that he opens a swiss or bermuda bank account to avoid the pigs.

Now I have seen it for myself...

Do you suggest your 'clients' to open those accounts to avoid police?

It'd be fun if you are in jail with your 'clients'. :lol:

[st7860]

hint:

many US banks do not do credit checks if you open a simple savings or checking account. they only check a system that checks to see if you have bounced a US check before. this means nobody will know you have an account in the US, except the americans.

(bank of america and US bank) are some examples of banks with branches near the US/Canada border that easily open accounts for Canadians.

both of them give you a VISA CHECK CARD with which you can spend/withdraw your money.

[15-20_God]

hint:

many US banks do not do credit checks if you open a simple savings or checking account. they only check a system that checks to see if you have bounced a US check before. this means nobody will know you have an account in the US, except the americans

hint:

and how does this help? its not illegal to have offshore accounts. however, it is illegal to evade taxes.

[monty613]

hint:

many US banks do not do credit checks if you open a simple savings or checking account. they only check a system that checks to see if you have bounced a US check before. this means nobody will know you have an account in the US, except the americans.


It's too bad he won't have any money to deposit since his assets are frozen!

Maybe a Sears credit card will solve all of his problems :lol:

[st7860]

bank of america or USBANK accounts usually pay no interest, AND, you are not required by canadian law to disclose foreign assets if they are not worth $100,000.

[monty613]

bank of america or USBANK accounts usually pay no interest, AND, you are not required by canadian law to disclose foreign assets if they are not worth $100,000.

So? Should the person in question just ignore the fact that the CRA froze his assets, and stash all of his money away at a US institution?

It would be easier for him to file his returns and get his taxes in order, rather than run away from the CRA for the rest of his life.

[st7860]

dam I did not know revenue canada has the right to do this kind of stuff. Did your friend get a warning from revenue canada. Revenue canada should have a court order to do this kind of stuff and your friend was probably ignoring them.


If this all happened withouth acknowledgement then thats just wrong my friend.

revenue cananda doesnt need a court order to lift money out of a bank account. they only need to issue a requirement to pay(any specially trained RevCan Bacon) can do it.

however, banks are entitled to ignore garnishee orders if some pieces of info are goofed up(such as wrong branch, wrong name, and so on)

and, unless someone comes after you with a PAYMENT HEARING, you're not required to disclose at which bank you keep your money.

[stevethewheel]

and, unless someone comes after you with a PAYMENT HEARING, you're not required to disclose at which bank you keep your money.

Well except for one thing. The bank will insist on a SIN when you set up your account, and guess who has legal access to everybody's SIN?

[st7860]

the bank is required to ask for a sin but is not required to HAVE a sin in order to give someone a bank account. some banks like scotiabank dont care, but they still ask for tons of ID.

[destro88]

what they probably did was sent him a few notices in which he ignored, once you ignore them they assess your returns without any income tax credits. Once assessed the money is collectible and thats when his file got turned over to revenue collections. Tell him to call up the officer and give them a time frame when they will be in, but make sure they're in. Then they'll be able to lift the hold off depending whether the guy/gal is nice. But some can be hard asses and want them all in at once and paid in full.

by any chance do you know the name of the officer who's handling the file??? lol i might know the person.

[shellysoda]

Wow, this is all very interesting! But you should get some sort of notice/warning first shouldn't you? I'm catching up on some back returns from a few years ago but I haven't gotten anything that has told me that I *have* to file yet. So hopefully they have to contact you first. Best of luck to your friend! Having an account at Bofa would be a help so that he could at least access some money while he'ss working things out (if he has any to deposit at this point).

[gman]

dam I did not know revenue canada has the right to do this kind of stuff. Did your friend get a warning from revenue canada. Revenue canada should have a court order to do this kind of stuff and your friend was probably ignoring them.


If this all happened withouth acknowledgement then thats just wrong my friend.

I don't know Revenue Canada can do that. I always think Revenue Canada is too soft. If they are more 'powerful' and mean, we may be able to pay less tax.

On the other hand, it is just frozen and they did not take the money away.

When I moved to Canada from Hong Kong, I filed all my tax return and I had a bank account in Hong Kong. One day, my mom told me Hong Kong tax department took all my money from my bank account. Since there was no money in the bank account, the bank closed it.

The reason they did that was they said I owed them money. The funny part was I went to their office before I left HK, brought all the document and asked them how much I owed them. I paid that amount. By the way, I would not get my last month salary from my employer if I did not clear that with the tax department since my employer knew I would leave Hong Kong.

Anyway, they said the money in my bank account was not enough and I still owed them money. They kept on calling my mom. After I reviewed their document, I wrote them a letter and pointed what they did wrong. The first tax officer who did my return was right. I did not owe them anything and they stole my money. However, they still kept on bugging my mom. They said I had to pay the balance and then they would refund the full amount to me. That is HOW THEIR SYSTEM WORKS.

I refused to do that because of principal. However, my mom decided to pay the balance for me. Then, shortly after, they did refund the full amount ... to ME. Now, it became another problem. The tax department send me a cheque with my name on it. I did not have a bank account in Hong Kong anymore. The bastard closed that. My mom was holding a cheque she could not cash. She needed to mail to me, I signed in the back and then send it back.

Now, you can see how EFFECTIVE the tax department of another government is.

[Sylvestre]

oh it's crazy what CRA can do. freeze assets, garnish wages, throw people in prison. it takes a lot but they have the power, and do use it.

seriously, for them to go this far, your "friend" must have really stuck his head in the sand. What did he think would happen?
Even worse, he'll be under a microscope for the rest of his life!

anyway, yah, as others said, call up and talk. But to be honest, your friend has shown he seems to have no interest in taking responsibilty so far, thus it's going to take a while before the goverment believes he'll be proactive on this.

[alexei]

so if i open a offshore bank account and its under 100 000 , I dont have to disclose it , is that correct?

[st7860]

so if i open a offshore bank account and its under 100 000 , I dont have to disclose it , is that correct?

Yes. You only have to disclose any interest or similar income you make from it. But if the money just sits there doing nothing, its fine.

.

[alexei]

is ing direct considered an "offshore account" , do you think revenue canada can freeze this account?

[gman]

is ing direct considered an "offshore account" , do you think revenue canada can freeze this account?

Any bank that operates in Canada is not "offshore".

[Steeve Urkel]

It's too bad he won't have any money to deposit since his assets are frozen!

Maybe a Sears credit card will solve all of his problems :lol:

Tell his employers to start paying him through Paypal for his work;)

Some of my employers actually send me my paycheques through paypal and then I have to file all the taxes myself.

[felix]

Tell his employers to start paying him through Paypal for his work;)

Some of my employers actually send me my paycheques through paypal and then I have to file all the taxes myself.
You'll still need to deposit those paypal funds into your bank account though so it would be the same if they look into your bank accounts. Unless of course you spend it all on goods (which my buyer does :lol:).

[shellysoda]

You'll still need to deposit those paypal funds into your bank account though so it would be the same if they look into your bank accounts. Unless of course you spend it all on goods (which my buyer does :lol:).

He could deposit in a Bank of America account too and then use his visa check card or like you said use a Paypal mastercard ;)

[jackieskwong]

why don't you just leave the money in a safe at home? better than to open a bank account in the states paying fees and the hassel.

[gman]

why don't you just leave the money in a safe at home? better than to open a bank account in the states paying fees and the hassel.

What kind of safe you have in mind?

A small one, anybody can move it out of the house. That is robbery.
A huge one which bolted to the foundation is expensive. A gun pointing to your head, you will open it for anybody.

Revenue Canada only needs a warrant to find out what is inside.

[mr.wiz0rd]

Dont you guys listen to 680 news?? Darryl H. Hayashi, former tax auditor for the CRA! (I'm not sure if that's how you spell his name, try different variations and google him)

http://www.680news.com/station/advertising.jsp

Client: Darryl H. Hayashi Chartered Accountant
Contact: (416) 751-7653