An Ottawa convenience store operator was sentenced to an 18-month conditional sentence and a fine of $83,499 after pleading guilty in the Superior Court of Justice to one count of tax evasion under the Income Tax Act.
The Canada Revenue Agency investigation found that from 2011 to 2014 Ali Kariminazagheh, also known as Ali Karimi (Karimi), as co-owner of the corporation 6443923 Canada Inc. (operating as Zesty Market and Glebe Smoke Shop), used sales revenue from his chain of Ottawa convenience stores for personal expenditures. He also failed to report $423,439 in business income on his individual income tax returns for this period, thereby evading $83,499 in income tax. Karimi did not file income tax returns for 2013 and 2014.
An expert from the Forensic Accounting Management Group within Public Services and Procurement Canada conducted a net worth analysis in relation to Karimi's assets, liabilities and expenditures and concluded that the total spending of Karimi and his household exceeded their funds from their known sources of income.
In a release the CRA warned that tax evasion is a crime and that falsifying records and claims, wilfully not reporting income, or inflating expenses can lead to criminal charges, prosecution, jail time and a criminal record.
- From April 1, 2020, to March 31, 2021, there were 36 convictions.
- Court imposed fines totalled $5,172,844.
- Taxpayers were sentenced for evading payment amounts totalling $10,902,950 in federal tax.
- Out of the 36 convictions, 15 individuals were sent to jail for a total of 26.2 years.
- In addition, convicted taxpayers have to pay the full amount of tax owing, plus related interest and any penalties assessed by the CRA.
The CRA said it "is continuously working towards making sure that individuals and businesses report income earned and eligible losses, and claim benefits to which they are entitled, so that important benefit programs can be available to those who need them. As a result of COVID-19, we are seeing the increased importance of these benefits, and are working to make sure that they continue to be available to Canadians. Any individual or business who underreports income, or claims losses or benefits to which they are not entitled, including ineligible claims for COVID-19 benefits, may have to repay the benefit amounts and may be subject to other possible action."