Skip to main content

The Globe and Mail

Ottawa to demand more details of foreign holdings

The shadows of shoppers are cast onto the ground in St Helier, Jersey November 13, 2012. Jersey, the British offshore tax haven, has since the 1960s developed a formidable offshore banking and finance sector . Picture taken November 13, 2012.

Stefan Wermuth/REUTERS

The Canadian government, trying to balance its books, is cracking down on tax evasion by forcing taxpayers to reveal more details of foreign holdings.

National Revenue Minister Gail Shea will unveil new reporting requirements Tuesday that will apply to taxpayers with more than $100,000 of offshore assets.

She will launch a more stringent reporting form that will require taxpayers to provide Ottawa with far more details of their non-Canadian investments, including the names of specific foreign institutions and countries where those holdings are located as well as the income earned on those assets.

Story continues below advertisement

Under the previous system, Canadians were not required to precisely identify where their holdings were located.

Ms. Shea will also detail a new rule that will allow the Canada Revenue Agency to lengthen by three years the normal reassessment period for delinquent owners of foreign holdings. A measure passed in the 2013 budget allows the tax collector more extended scrutiny of people who have failed to report income from a foreign investment on their return or if they neglected to file this disclosure in time.

Global tax avoidance has become a major political issue for governments around the world, particularly in light of a recent leak of data showing the widespread use of offshore tax havens.

The Canada Revenue Agency has dedicated $30-million over five years as part of its efforts to crack down on Canadians avoiding paying their required share of taxes on assets squirrelled away offshore. It has already created a new dedicated "SWAT team" of six to 12 experts focused on international tax evasion – part of measures in the 2013 budget that Ottawa expects will help bring in hundreds of millions of dollars in new revenue.

"We will continue to aggressively crack down on international tax evasion and aggressive tax avoidance by strengthening reporting requirements for Canadians with offshore assets," a government source said Monday. "We are determined to relentlessly pursue those tax cheats who attempt to scam the system and all taxpayers."

All these measures take effect in the 2013 tax year.

The government has already announced it's launching a "stop international tax evasion" tip line that will reward whistle-blowers with as much as 15 per cent of taxes collected on assessments exceeding $100,000 in federal tax.

Story continues below advertisement

As part of the $30-million over five years, the government is spending $15-million setting up a system that will require bank and other financial institutions to report on international electronic transfers of $10,000 or more.

The budget revealed the government is counting on strong compliance at the CRA to help erase the deficit. Ottawa has booked $2.4-billion over six years in additional revenue from stronger tax compliance measures.

Report an error Licensing Options
About the Author
Parliamentary reporter

Steven Chase has covered federal politics in Ottawa for The Globe since mid-2001, arriving there a few months before 9/11. He previously worked in the paper's Vancouver and Calgary bureaus. Prior to that, he reported on Alberta politics for the Calgary Herald and the Calgary Sun, and on national issues for Alberta Report. More

Comments

The Globe invites you to share your views. Please stay on topic and be respectful to everyone. For more information on our commenting policies and how our community-based moderation works, please read our Community Guidelines and our Terms and Conditions.

We’ve made some technical updates to our commenting software. If you are experiencing any issues posting comments, simply log out and log back in.

Discussion loading… ✨

Combined Shape Created with Sketch.

Globe Newsletters

Get a summary of news of the day

Combined Shape Created with Sketch.

Thank you!

You are now subscribed to the newsletter at

You can unsubscribe from this newsletter or Globe promotions at any time by clicking the link at the bottom of the newsletter, or by emailing us at privacy@globeandmail.com.