A Prince George businessman has been issued a steep fine for violations of the Income Tax Act.
Kewal Singh Raju was ordered in Prince George provincial court on Wednesday to pay $113,164 after pleading guilty to one count of income tax evasion and three counts of fraudulently claimed input tax credits, income tax and goods and services tax evasion respectively.
Raju was also sentenced to an 18 month conditional sentence - where he serves his time at home rather then in jail - and his company, Raju Homes Ltd., was fined a further $74,366.
The outcome follows a Canada Revenue Agency investigation that found Raju received $233,012 in direct payments from several Raju Homes Ltd.'s clients and deposited these into his personal accounts without reporting them.
As well, investigators found he falsely claimed $297,470 in business expenses and input tax credits on behalf of Raju Homes Ltd. for four houses built for Raju and his immediate family members where no payment was made to Raju Homes Ltd.
It was further determined that Raju claimed $49,984 in personal expenses as business expenses and input tax credits.
The fines represent 75 percent of the taxes evaded. The maximum penalty is 200 per cent of the tax evaded and a five-year jail term.
Taxpayers who have not filed returns for previous years, or who have not reported all of their income, can still voluntarily correct their tax affairs, the CRA said in a statement.
They may not be penalized or prosecuted if they make a valid disclosure before they become aware of any compliance action being initiated by the CRA against them.
These taxpayers may only have to pay the taxes owing, plus interest.
More information can be found at www.cra.gc.ca/voluntarydisclosures.
