Report a lead on suspected tax or benefit cheating in Canada – Information to include

From: Canada Revenue Agency

3. Information to include

You may not have all the information suggested below. But the more details you give, the easier it is for the CRA to level the playing field for all Canadians. Below is the type of information the CRA would like to receive to allow it to take the appropriate action. However, do not put yourself in danger or break the law to get it.

Key identifiers

Include specific information about the subject of your lead (could be a person, business or charity), such as:

  • full name of the suspected tax or benefit cheat / spouse’s name / address / birthdate / social insurance number / social media accounts
  • business name / business address / business number
  • any related businesses, shareholders, contractors, etc.
  • description of the suspected tax or benefit cheat’s properties, vehicles, loans, mortgages, banking information, or personal expenditures

Facts

Describe what you know about the subject of your lead, with as many details as possible, including:

  • why you believe this person, business or charity is cheating
  • dates or length of time the suspected cheating occurred
  • whether anyone else was involved
  • any lifestyle issues like lavish spending not in line with income level (include details of purchases such as where, when, how, how much)

Supporting documents

If you have supporting documents to complement the lead, send them by mail. Examples of supporting documents are:

  • emails with details that help identify the suspected tax or benefit cheat
  • invoices and/or receipts
  • cheques
  • financial statements
  • contracts, leases
  • bank account numbers

If you submit your lead online or by phone, you will be given a reference number. Write your reference number on your supporting documents and mail them to the National Leads Centre. The CRA will match your supporting documents to the lead you submitted. The documents will not be returned to you.

Examples of complete and incomplete leads

The following examples show the differences between a lead that is complete and one that is incomplete.

A complete lead has enough details to help the CRA conduct a review to figure out if someone is cheating. An incomplete lead makes it more difficult to conduct a review and may not allow the CRA to address the suspected cheating. Give as much information as you can; the CRA will take it from there.

Complete lead

My next-door neighbour, John Smith, who lives at 123 Anywhere Street in City, Province, with his wife Karen Smith, has been collecting employment insurance (EI) benefits since January 2015 but is working full-time doing cash construction deals. I’m losing business to him because I can’t compete when I pay my taxes, charge GST, and pay workers’ compensation. He has been renovating a house at 129 Anywhere Street for the last eight months for the owners, Walter and Betty Parker. He also did the same thing last year at 156 Anywhere Street for owners, Bob and Susan Jones. He bragged to me that he pocketed $32,000 tax-free from that work. John’s birthday is November 16, and he drives a blue Mercedes (2015, which he bought in July 2015 while on EI) with the licence plate A1A1A. He calls his business “John’s Renovation Solutions.” He opened it in April 2014 after he got laid off from Big Company. He often hires another neighbour, Mark Miller, who lives at 135 Anywhere Street, to do his electrical work. Mark is retired from Big Company.

This lead has enough key identifiers (name, address, spouse’s name, birthday, business name, licence plate number, and former employer) to identify the person who is alleged to be cheating on their taxes.

It also gives factual details about the length of time the suspected tax cheating has been going on, the dollars involved, others who may be involved, and lifestyle issues (expensive car purchase). Although supporting paperwork and documents would be helpful, in this case there are enough details for the CRA to conduct a review to figure out if this person is tax cheating or not.

Incomplete lead

My neighbour is driving a new car, and I’m sure he doesn’t make enough money to pay for it. I think he is doing cash deals. His name is Bob Jones. We live in City, Province, on Park Street. He also goes on trips all the time. He claims he works for a coffee shop, but I’ve seen his garage and trunk; they are full of tools. People come by often and he is always working on cars in the driveway. I’m sure that’s how he makes his money. There’s no way he pays all his taxes.

This lead is missing facts, and it’s based on opinion. Without clear facts related to the suspected tax cheating (where, when, how, how much), the CRA will not be able to address the suspected tax cheating described in this lead.

Also, a partial street address (a street name without the number) is not always enough to identify a person, business or charity, so the CRA’s ability to conduct a review of this person is weak.

Canada Emergency Response Benefit (CERB), Canada Emergency Student Benefit (CESB), and Canada Emergency Wage Subsidy (CEWS) leads

In 2020, the Government of Canada started providing financial supports to help Canadians and businesses facing hardship as a result of the global COVID-19 outbreak. The CERB provides financial support to employed and self-employed Canadians who are directly affected by COVID-19. The CESB provides financial support to post-secondary students, and recent post-secondary and high school graduates who are unable to find work due to COVID-19. The CEWS enables employers to re-hire workers previously laid off as a result of COVID-19 and helps prevent further job losses during the crisis.

The CRA and Service Canada have records of all individuals who’ve received payments for the CERB and CESB, and are verifying to make sure the payments were correctly allocated. Similarly, various pre-payment verifications and post-payment reviews are being conducted by the CRA for the CEWS. However, if you suspect a potential misuse of the COVID-19 emergency benefits and programs, the National Leads Centre is currently accepting leads on these programs.

We encourage you to bring your CEWS concerns to your employer first. If you aren’t satisfied with your employer’s response, you can report your concerns to the CRA.

Details to include in your CERB, CESB, or CEWS lead submission

In Step 3 of the online submission form, you will find a free text field to describe the allegation. Alternatively, if you call the National Leads Centre to submit your report, the agent will guide you through your submission.

Below are details that can enhance your CERB, CESB, or CEWS lead submission and help the CRA review the facts. It’s not necessary to provide all the information below in your submission, simply tell us as much as you can.

For the CERB, provide details about the individual’s:

  • work situation
    • employee or self employed
    • type of business
    • current status of income
  • employer
    • name and type of business
    • frequency of work
    • reasons for loss of employment
  • eligibility
    • earns more than $1000 in allowable income in the 4-week period
    • did not earn at least $5000 in employment or self-employment income in 2019
    • is also applying for other benefit programs
    • is receiving multiple CERB payments from both the CRA and Service Canada
    • is using other SINs to apply

For the CESB, provide details about the individual’s:

  • schooling situation
    • name of educational institution
    • area of study
    • expected graduation date
    • plans for future enrollment
  • work situation
    • status of employment
    • type of business
    • methods of seeking work
  • employer
    • name and type of business
    • frequency of work
    • reasons for loss of employment
  • eligibility
    • is not a recent graduate, not currently enrolled and/or international student
    • earns more than $1000 in allowable income in the 4-week period
    • is receiving other benefits for the same period

For the CEWS, provide details about:

  • the employer (the business name and the legal name)
  • type of business (goods and/or services provided by the business)
  • the loss of employment
    • changes to employee’s hours of work
    • when these changes occurred
    • timeline of events
  • the number of employees affected
  • the employer’s payroll (are workers employees or sub contractors?)
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