Taxation and tax litigation

Expertises connexes

While tax law enforcement is a reality for both businesses and individuals, insufficient or no tax planning can lead to litigation and could even be fatal for a business. Likewise, the distinction between legitimate tax planning and abusive tax avoidance can lead to serious charges being laid against the taxpayer. Faced with these significant risks, it is easy to understand that a good tax planning goes hand in hand with a healthy business. The multidisciplinary team at Bernier Fournier law firm has a combination of knowledge and experience enabling it to support businesses in carrying out sound tax planning.

Companies doing business in Québec are governed, at the federal level, by the Income Tax Act (hereafter ” I.T.A. “) and by the Taxation Act, at the provincial level. Moreover, many regulations and ministerial guidance supplement these two laws, thus creating a rather indigestible package for the unaccustomed since specific rules apply to self-employed workers, to estates, to non-residents of Canada, to trusts, to companies dealing at arm’s length, etc.

Although our tax system is based on self-assessment, there is a important verification mechanism in place to ensure that everyone is following the law. The verification process can take a few hours or several weeks and the possible verification methods are very diverse. At this stage, the taxpayer must collaborate diligently since the Canada Revenue Agency (hereafter ” C.R.A. “) is vested with several powers in order to force collaboration of the recalcitrant taxpayer¹.

Following the verification, the C.R.A. may issue a notice of assessment or an additional assessment. To this point, the investigation is under civil law and is aimed only at the collection of taxes. However, if the C.R.A.’s routine audit uncovers evidence of fraud, tax avoidance or misrepresentation, then the investigation may become criminal in nature. For the taxpayer, the degree of collaboration is less, but the consequences that may arise are greater. Whether you are facing civil or criminal proceedings, Bernier Fournier’s lawyers are able to advice, support and represent you in order to defend your rights.

Although its powers are very broad, the C.R.A. must, nonetheless, respect several rules in matters of criminal investigation, including, among others, the need to obtain a search warrant². Indeed, the taxpayer under criminal investigation benefits from the rights and freedoms recognized by the Canadian Charter of Rights and Freedoms, in particular the right to silence and to protection against self-incrimination³.

To dispute a notice of assessment from the C.R.A., to ascertain the nature of an investigation concerning your business or yourself, or to know your obligations and your rights towards the C.R.A. investigators, the advice of a lawyer can be essential.

The professionals at Bernier Fournier understand your concerns and will be able to analyse your situation and put in the energy necessary to vigorously assert your rights and your financial and commercial interests.

 

¹ Income Tax Act, R.S.C., 1985, c. 1., (5th Supp.), art. 150, 231.1 et 231.2.
² Canadian Charter of Rights and Freedoms, Part. 1 of the Constitution Act, 1982, Schedule B to the Canada Act (UK), c. 11, art. 8.
³ Id., art. 7.