There’s a scam created every day
Mary and William are married and have three kids. They are both working professionals but with the rising costs of kids, bills, and mortgage, they find themselves having trouble making ends meet.
One day, Mary and William receive an invitation in the mail to a seminar that promises hefty tax breaks. During the seminar, a representative from a charity explains to the group that if they donate immediately they will receive tax receipts for four times the amount they donate. Mary and William figure this is a winwin; they will be donating to a deserving charity and will get a hefty tax break. They decide to each donate $500 because the tax break will help them with their financial troubles.
After filing their tax claim for the donation, Mary and William receive a notice that the Canada Revenue Agency will be holding their assessment while they review the case. It turns out that Mary and William were tricked into a gifting tax shelter, and ended up losing the money that they paid without a tax break. They are embarrassed and upset.
Does this scenario sound familiar? This couple is not alone. In recent years, approximately 2,500 individuals a year participated in gifting tax shelter arrangements. To date, over 190,000 Canadian taxpayers who donated to one of these tax shelter schemes have been reassessed. Nearly $6.3 billion in donation claims have been denied. Be wary if you are offered a tax receipt worth more than the amount you donated.
Obtain independent professional advice from a tax advisor before signing any documents.
Ask for written information about the charity, including name, address and telephone number.
Call the charity. Find out if the organization is aware of the solicitation and has authorized the use of its name. If not, you may be dealing with a scam artist.
Confirm if the charity is registered and eligible to issue official donation receipts through CRA’s charities listings.
Ask the representative for the charity’s registered charitable tax number. Refuse high pressure sales pitches. Legitimate fundraisers will not push you to give on the spot.
Amy is a young professional beginning her career after graduating from university. One day at work, she receives a call from a number that she doesn’t recognize. The individual on the line identifies himself as a CRA employee, and claims that Amy has an outstanding debt. He explains that confirmation of Amy’s personal information, including her birthdate and bank account, is required to sort out the debt with a re-payment plan.
Amy does not recall owing the CRA money. What’s more, she does not remember providing the CRA with her work number. When she voices these concerns, the requester becomes agitated, and warns Amy that there will be consequences if she does not cooperate. Although she is apprehensive, she has never personally dealt with the CRA and assumes the request must be normal. She reluctantly agrees to provide the information.
Does this scenario sound familiar? Every year, Canadians lose millions of dollars to telephone phishing scams that result in identity and financial theft. Beware of telephone calls claiming to be from the CRA. The CRA never asks for information such as credit card, health card or passport numbers. The CRA never threatens to lay criminal charges or have you put in jail if you don’t pay your taxes. If a telephone scammer uses threats to coerce you into providing personal information, ignore the call and report it to the RCMP Anti-Fraud Centre by email at www.antifraudcentrecentreantifraude.ca or by calling 1-888-495-8501. If the CRA does need to contact you by telephone, there are established processes in place to ensure your personal information is protected. If you want to confirm the authenticity of a CRA telephone call by calling the CRA using the numbers on its telephone numbers page. For business-related calls, call 1-800-959-5525 and for individual concerns, contact 1-800-959-8281.
DON’T BE A VICTIM: Check out the anti-fraud centre’s site for valuable scam-foiling tips.