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Voluntary disclosure window closing as CRA explores Panama Papers

Following news that the Canada Revenue Agency (CRA) has access to the information contained in the infamous ‘Panama Papers,’ time is running out for those involved to file a voluntary disclosure with the taxman, Toronto tax attorney David J. Rotfleisch tells

As CBC News reports, although the CRA will not confirm exactly how it acquired the entire cache of 11.5 million files, a spokesperson says the last files arrived on Thursday, via tax treaty partners in the G20.

In addition, the International Consortium of Investigative Journalists (ICIJ) made a searchable database available this week that reportedly allows the public to look up names and companies contained in the Panama Papers. The documents detail more than 214,000 offshore companies, trusts and foundations administered by Panama-based law firm, Mossack Fonseca.

“The public database does not contain the trove of personal information in the leak such as passport photocopies, emails, bank account numbers or stock certificates. The ICIJ, whose media partners include CBC News and the Toronto Star in Canada, is withholding that for privacy reasons,” the CBC article reports.

As previously reported, the Minister of National Revenue also recently filed a federal court application seeking an order under the Income Tax Act to compel the Royal Bank of Canada (RBC) to reveal the identities of clients with “relationships or connections” to Mossack Fonseca. According to a Reuters report, RBC has agreed to hand over the names.

As Rotfleisch, founding tax lawyer at Rotfleisch & Samulovitch Professional Corporation, explains: “This searchable database was fully expected and is consistent with the 2013 ‘offshore leak,’ which was also orchestrated by the ICIJ. The names of Canadians involved may now be fully searchable by the CRA as well as the general public. RBC has already agreed to release the names of its clients for whom they set up offshore corporations to the CRA.”

As such, he cautions, Canadians who are impacted and have undeclared offshore income or assets have a "closing window to file a voluntary disclosure to avoid tax evasion prosecution.

"Once the CRA starts an investigation it will be too late,” says Rotfleisch.

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