CRA fears Black won’t pay his dues
Officials say former media baron may skip out on $12.3M in disputed taxes
OTTAWA— Tax officials say they are concerned former media baron Conrad Black could skip town before paying more than $12.3 million in disputed taxes.
But Black’s lawyer said in an interview the idea Black would leave Canada is “nonsense,” and said his client intends to stay in the country for the foreseeable future.
Documents filed by the Canada Revenue Agency (CRA) in Federal Court last month show Black is disputing $12,319,514.30 in taxes.
The CRA successfully sought court permission to put liens on Black’s Bridle Path mansion at 26 Park Lane, which court documents said sold for $14 million last month. There is just over $13 million in outstanding mortgages on the property, the document said.
The agency argued there are reasonable grounds to believe Black will not pay his outstanding tax debt, given that he sold his last remaining Canadian property, the depreciation of his assets over time, and his “apparent intentions towards his tax obligations.”
The agency points out in the documents that Black, who renounced his Canadian citizenship in 2001to sit in the British House of Lords, has significant international connections that would make it easy for him to move himself or his assets away from the long arm of the Canadian taxman.
“It is open to Black, and would be relatively easy for him, to move his funds, including his liquidated equity from Park Lane, offshore or to relocate abroad at any time, thereby jeopardizing the collection of his tax debt,” the documents said.
But his lawyer, David Nathanson, told the Star that Black has no intention to leave the country and will renew his temporary Canadian visa before it expires this September.
Nathanson said the dispute over Black’s taxes has dragged on for approximately a decade. Separate court filings from Black’s lawyers suggest CRA’s application to put a lien on his mansion contained inaccuracies and conjecture.
“The affidavit, from our point of view, is highly conjecturable and contains insinuations as opposed to statements of fact,” Nathanson said.
“The chief one is the conclusion or the inference that the CRA has drawn that Mr. Black intends to flee the jurisdiction. That is simply false.”
In February, Black revealed he was selling his posh 6.6-acre property at 26 Park Lane Circle in North York.
Before the nine-bedroom mansion went up for auction, however, Black reached a deal with an unnamed buyer to sell it for $14 million — well below the CRA’s $19.9 million appraisal of the property’s value and the $21.8 estimated auction value.
Black told the Star that the deal was a “sale and lease-back with a possible buy-back.” The court documents show Black is renting the mansion for an annual base rent of $155,000 for two years, with an option to renew.
Black’s reported income in 2014 totalled almost $8 million, according to CRA, with $7.7 million coming from interest from loans to Hollinger Inc., Black’s former holding company.
His taxable income was $0, however, “largely because of claimed carrying charges for bad debt to Hollinger Inc. in the amount of $7,703,345.00.” His net business income was $179,393, with the former media mogul listing “freelance writer” as his occupation. Black occasionally writes for the National Post, the paper he founded in 1998, and listed deposits totalling $33,448 from the newspaper between July 2014 and July 2015.
Black’s lawyer told the CRA that he has other assets “the value of which he expects to appreciate substantially” and that Black’s wife, Barbara Amiel-Black, has substantial commercial assets that can assist Black in paying off liabilities if necessary.
The court documents said that the United States government has asked Canadian officials to assist them in collecting more than $19 million in taxes Black is alleged to owe in that country.
U.S. tax officials state that Black has not responded to any correspondence about the outstanding tax bill, which dates back to 1998, the court document said.
Black recently sold off a number of properties in the U.S. and the United Kingdom, including a U.K. property for £13,110,000 in May 2005, a New York apartment on Park Ave. for $10.5 million (U.S.) in October 2005 and a Palm Beach mansion for $2.35 million in May 2004.