TAX NEWS - June 2010

Canada Tax: Tax evasion trial set

A Moncton company and its president will stand trial on charges of tax evasion after pleading not guilty in Moncton provincial court.

Terry Rickard and Roadway Systems Limited face nine charges between them, alleging tax evasion between 2004 and 2007. They were represented by Wendell Maxwell in court yesterday, who was appearing on behalf of the lawyer who will represent the defendants at trial.

The prosecutor told the judge five days will be required for the trial because 15 witnesses will be called by the Crown. Judge Anne Dugas-Horsman set the matter for the week of Dec. 6.

A Canada Revenue Agency officer laid the Income Tax Act charges against Rickard and Roadway Systems, which is an electrical and underground utility contractor that was founded in 1992 and has more than 60 employees. Rickard faces four charges while the company is charged with five offences.

Rickard is accused of making or participating in false statements on his tax return in April 2006 by understating his taxable income by almost $16,000; making or participating in false statements on his tax return in April 2007 by understating his taxable income by almost $47,000; willfully evading payment of more than $3,500 of federal income tax between December 2004 and April 2006; and willfully evading paying $12,800 of federal income tax between December 2005 and April 2007.

Roadway Systems faces four similar charges dealing with almost the same amounts of money for the same time periods, along with a fifth charge. The extra charge alleges the company, between December 2004 and March 2006, made or assented to false or deceptive entries or omitted entries in the company's records or books of account that resulted in the failure of employees reporting taxable income in the amount of $33,137.70 resulting in the evasion of $7,329.87 of federal income tax for the 2005 taxation year.

According to the Income Tax Act, anyone convicted of these offences could be fined between 50 per cent and 200 per cent of the tax sought to be evaded and could also be imprisoned for a term not exceeding two years.

Whenever a company or individual is convicted of tax offences, they are also responsible for paying the full amount of the taxes owing plus interest as well as any civil penalties that may be assessed by the Canada Revenue Agency.