Ongoing Panama Papers Leak CRA Tax Audits

On January 16 and 17, 2017 CRA participated in a meeting of the Joint International Taskforce on Shared Intelligence and Collaboration Network (JITSIC), a network of over 35 tax administrations. The meeting was as a result of the Panama Papers leak and the role of Panamanian law firm Mossack Fonseca and included the largest simultaneous exchange of information under international tax treaties. Internationally, due to the efforts of the various JITSIC members, over 1,700 tax reviews and tax audits have been commenced, over 2,550 requests for information have been issued and a target list of 100 intermediaries has been identified for further review. In Canada, over 76 taxpayer audits in relation to the Panama Papers are underway and extensive data is currently being reviewed by the Canada Revenue Agency. In addition to these tax audits, the CRA has executed tax search warrants and criminal tax investigations are ongoing.

To assist in the tax audits, JITSIC members agreed to pool information on key intermediaries from domestic efforts such as data analytics, voluntary disclosures, interviews with taxpayers, and other relevant documentation, all in accordance with the legal tax agreements that allow for the exchange of information.

It is probably too late for any Canadian taxpayer who is being investigated to submit a voluntary disclosure application (VDP) but advice from a Canadian tax lawyer is essential.