Real Estate Developer Charged With Tax Evasion by CRA

Hon. Diane Lebouthillier, Minister of National Revenue

Realtors and immigrant entrepreneurs going into Real Estate development and property deals should be mindful. The Canada Revenue Agency (CRA) last week announced that Devender Singh Dhillon, a Real Estate developer from Surrey, British Columbia, has been charged with two counts of making false statements and three counts of Goods and Services Tax/Harmonized Sales Tax (GST/HST) evasion under the Excise Tax Act.

According to a CRA statement, the criminal charges laid against Mr. Dhillon allege that he failed to report and remit $371,735.52 in GST/HST collected from the sale of eight residential properties in North Vancouver and Surrey. As director of Oakwood Homes Inc. and Elgin Oaks Homes Ltd., Mr. Dhillon was actively involved in the companies’ purchase and development of real estate, and maintained the companies’ books and records. It is also alleged that Mr. Dhillon failed to report over $10 million in sales on the companies’ GST/HST returns, for the March 2013 to September 2015 reporting period.

All case-specific allegations above were obtained from the court records, including the “Information to Obtain a Search Warrant”, the principal document used to set out the grounds for the issuance of a search warrant.

The CRA investigates suspected cases of tax evasion, fraud, and other serious violations of tax laws and recommends cases to the Public Prosecution Service of Canada (PPSC) for criminal prosecution. During the 2019-2020 fiscal year, the PPSC conviction rate for tax-related crimes was 94%.

The CRA stated that they are “dedicated to maintaining the integrity of Canada’s tax system, as well as the social and economic well-being of Canadians during these unprecedented times. The CRA continues to aggressively pursue tax evasion and false claims with all tools available to them.”

The CRA Headquarters added that it is “continuously working towards making sure that individuals and businesses claim income earned, eligible losses, and benefits to which they are entitled, so that important benefit programs can be administered to those who need them. As a result of COVID-19, we are seeing the increased importance of these benefits, and are working to make sure that they continue to be available to Canadians. Any individual or business who underreports income, or claims losses or benefits to which they are not entitled, including ineligible claims for COVID-19 benefits, may have to repay the benefit amounts and may be subject to other possible action.”

New immigrants to Canada, business owners, Real Estate agents, investment property investors and owners should be aware of the new CRA compliance and enforcement guidelines.

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