Description
Penalty/Offence
Late or deficient instalment
payments
50% of the interest payable on instalments for
the year in excess of $1,000, or 25% of interest
payable computed as if no instalments had been
made, whichever is greater
Failure to deduct or withhold tax
First occurrence—10% of amount not deducted
or withheld
8
Second occurrence—20% of amount not
deducted or withheld
9
False information on tax shelter
application or sale of tax shelter
before number is issued
Greater of $500 and 25% of cost of shelters sold
prior to the correct information being filed or
issuance of identification number
Wilfully providing incorrect
tax shelter identification
number
On summary conviction, fine from 100% to
200% of cost of tax shelter, imprisonment for up
to two years, or both
Tax evasion
On summary conviction, fine from 50% to 200%
of tax sought to be evaded, or both the fine and
imprisonment for up to two years
On indictment, fine from 100% to 200% of tax
sought to be evaded and imprisonment for up to
five years
Third-party participation in
a misrepresentation
Greater of $1,000 and penalty levied for a false
statement or omission, capped at a total of
$100,000 plus third-party’s compensation
Third-party misrepresentation
in tax planning arrangements
Greater of $1,000 and 100% of the gross
revenue derived from the arrangement if the
arrangement is in respect of a planning or
valuation activity
Selected Federal Penalty and Offence Provisions / 115
Current as of May 3, 2013
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