Calgary land flipper sentenced for failing to report $7.5 million in land sales

The Canada Revenue Agency (CRA) announced that on March 24, 2022, Rodney Potrie, Director of RAP Designs Inc., of Calgary, Alberta, was sentenced in the Provincial Court of Alberta, to a conditional sentence of 15 months, and was fined a total of $643,228, which represents 100% of the taxes evaded. On November 16, 2021, Mr. Potrie pleaded guilty to one count of tax evasion under the Income Tax Act.

A CRA investigation revealed that RAP Designs Inc. bought 110.94 acres of vacant land in Carstairs, Alberta, for $3,120,000, in 2008. He then undertook a series of land transfers that he knew were taxable and eventually sold it later that year for $7,500,000. Despite knowing it was taxable, he filed a nil T2 corporate tax return for 2008, failing to report $3,472,962 of income. It was determined that Mr. Potrie intentionally evaded $643,228 in income tax.

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

Tax evasion is a crime. Falsifying records and claims, wilfully not reporting income, or inflating expenses can lead to criminal charges, prosecution, jail time, and a criminal record. From April 1, 2020, to March 31, 2021, there were 36 convictions, with Court imposed fines totalling $5,172,844. These taxpayers were sentenced for wilfully evading payment amounts totalling $10,902,950 in federal tax. Out of the 36 convictions, 15 individuals were sent to jail for a total of 26.2 years.

In addition to court imposed fines and/or jail sentences, convicted taxpayers have to pay the full amount of tax owing, plus related interest and any penalties assessed by the CRA.

The CRA is dedicated to maintaining the integrity of Canada’s tax system, thereby contributing to the social and economic well-being of Canadians, particularly during these unprecedented times. The CRA continues to aggressively pursue tax evasion and false claims with all tools available to it. The CRA works to ensure that individuals and businesses report all income earned and only claim benefits to which they are entitled, so that important benefit programs can be administered to those who need them. 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.

Associated Links

Leads Program
Voluntary Disclosures Program

Contacts

Media Relations – Regional contact
Joanne de Waal
Canada Revenue Agency
306-517-0515

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