CRA Targets PayPal Tax Evaders 

The Canada Revenue Agency (CRA) has recently intensified its efforts against tax evasion, particularly targeting Canadian businesses using PayPal. Following a Federal Court of Canada order, PayPal is now required to disclose details of its business account customers to the CRA. This directive primarily concerns Canadian business account holders who have conducted transactions through PayPal since 2014. The CRA aims to use this information to verify if these businesses have fully declared their income. 

This move by the CRA follows a similar action involving the payment processor Square. Non-disclosure of income can lead to significant consequences, including additional taxes, interest, penalties, and potentially criminal charges against the taxpayers involved. However, there is a potential avenue for relief through the Voluntary Disclosure Program, which might help affected individuals avoid criminal prosecution, certain penalties, and some interest. Eligibility for this program depends on specific pre-conditions, and a tax expert’s assessment is necessary to determine if individuals impacted by the PayPal order qualify. 

The CRA’s recent actions signify a more aggressive approach in uncovering tax evasion and unreported or under-reported income. For those who have not fully declared their income or have concealed income or property, it might be prudent to proactively address these issues, as the CRA’s reach is extending, leaving fewer places to hide.