Has Canada Revenue put the fear of God into brokers? Well, at least the fear of an audit, if the latest MortgageBrokerNews poll is any indication.
Almost two-thirds of brokers who responded to the online poll this week said they handed their taxes over to the professionals, likely reflecting the tighter scrutiny by Canada Revenue on self-employeds.
The poll, which can be found on the home page, asks “Did you do your own corporate and personal taxes this year?” had 37 per cent responding “yes,” while a whopping 62 per cent replied that they handed their taxes over to someone else.
Finance Minister Jim Flaherty
has told the CRA to collect more than $500 million extra from suspected tax cheats this year, with auditors applying a rare 50 per cent penalty for “gross negligence” even on those who have never owned a condo previously.
“Most mortgage brokers are commissioned sales people who receive a T4A, and then write off their business expenses against their earnings – they are therefore at high risk of being audited by CRA,” IMBA
CEO Samantha Gale
told MortgageBrokerNews, adding that “The CRA is a powerful government entity and the Income Tax Act is overwhelmingly complex. Industry members facing a CRA audit need an advocate to ensure that the audit result is fair and they do not overpay on taxes, penalties and interest.”
After a particularly difficult 2012 in the mortgage industry, brokers apparently have turned to those experienced in preparing tax returns to find every tax loophole and saving available – without fearing the CRA audit sword of Damocles hanging over the head.