After taking a deeper look into B.C.’s real estate sector, Canada’s tax regulator has uncovered $1.3 billion in unpaid tax bills.
VANCOUVER —
Since launching a dedicated real estate task force in 2019, the CRA has mostly focused on Ontario and B.C., increasing the number of audits performed, sending out reassessment notices for billions of dollars in additional taxes the agency believes should be paid, and levying hundreds of million dollars in penalties.
Although the total value of unpaid taxes and penalties found in B.C. and Ontario was similar, the nature of non-compliance was markedly different in the two provinces. • People, including those who aren’t residents of Canada, failing to report capital gains on sales of real estateThe CRA declined to provide details about the categories for the $957 million — for example, how much was related to property flippers or developers or non-residents — citing the need to protect taxpayer information and maintain “the integrity of our risk assessment system.”
Canada’s 2019 federal budget included $50 million over five years for the CRA to create a real estate task force, with specialized audit teams. Last month, the 2024 budget boosted that funding to $73 million for the next five years. Davidoff co-authored a 2022 paper published in The Canadian Tax Journal, which found the top five per cent of Greater Vancouver homes had a median value of $3.7 million, while the median owner paid income taxes of just $15,800.
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