Auditing Tax Returns

[caranna]

In February, I went to a financial advisor for a consultation and he advised me that it would be a good idea to have CRA audit my to be ex spouses' tax returns.

Since my to be ex hasn't been forthcoming with his financial information, especially off-shore accounts and pension , etc., I've decided to pursue this option.

Anyone had this experience of having their ex-spouses tax returns audited?

[Tayken]

In February, I went to a financial advisor for a consultation and he advised me that it would be a good idea to have CRA audit my to be ex spouses' tax returns.

Since my to be ex hasn't been forthcoming with his financial information, especially off-shore accounts and pension , etc., I've decided to pursue this option.

Anyone had this experience of having their ex-spouses tax returns audited?

Good luck with that one. First off, you can't have someone else's taxes "audited" by the CRA. You could make an anonymous claim to tax fraud which you have every right as a citizen but, the CRA will disclose no information to you or the courts.

The only way to do what you are discussing is to get an order from the court for a forensic accountant. A forensic accountant costs anywhere from 250-500 an hour at times. If your claims about "offshore" and other "accounts" that you "believe" exist in fact do not, you will bear the costs of the forensic accountant and the costs the other party incurs as a result of your possibly frivolous claims against the other party (your "ex") in any litigation.

Good Luck!
Tayken

[caranna]

Thanks for the information. There's no doubt that he did open offshore accounts. Whether or not they are still operating is a matter that my lawyer and I are trying to ascertain.

[arabian]

CRA will not audit if they have reason to believe the ex wife reported the alleged fraud. Even if you mail in substantiating evidence they will do nothing about it. If you had your lawyer send in information that may get their attention.

[Tayken]

CRA will not audit if they have reason to believe the ex wife reported the alleged fraud. Even if you mail in substantiating evidence they will do nothing about it. If you had your lawyer send in information that may get their attention.

And your lawyer a nasty complaint letter to the Law Society of Upper Canada too.

[caranna]

CRA will not audit if they have reason to believe the ex wife reported the alleged fraud. Even if you mail in substantiating evidence they will do nothing about it. If you had your lawyer send in information that may get their attention.

Thanks Arabian. That's interesting about CRA not auditing if they might think the ex-wife (or ex-husband also, I presume), reported the fraud. I suppose it is because they have learned that there are a lot of bitter ex-spouses that want to do this for vengeful purposes. If that is the reason, I can understand their reluctance. I'm simply wanting financial disclosure, and if the audit reveals he is above board, then that's great.

Yes, I had planned to contact my lawyer and request his assistance.

[randomjohndoe]

I think you are unrealistic in your expectations of the outcome of the audit. Just how do you expect the CRA will uncover his secret stash? At most they can do lifestyle audit, i.e. look at expensive purchases (cars, real estate) and credit card expenses and see if that matches the declared income. If he is not dumb then there will be nothing out of the ordinary. And I assume he is not dumb if he managed to earn the money in the first place.

[FaithandMorals]

so called "Offshore accounts" are becomming harder and harder to hide these days. Switzerland is no longer as opaque as it was and the smaller countries that do offer real secrecy carry a risk as they do not usually abide by international fiscal laws which means getting info from them will be hard too.

Do yourself a favour and work out the cost benefit of how much you would have to find your ex has stashed to make the fishing expedition worthwhile. Then ask yourself if it is likely your ex has that kind of money there still. If the ex is sneaky and suspects you know what country it is in, why wouldn't the ex just move the cash to another country?

[caranna]

I think you are unrealistic in your expectations of the outcome of the audit. Just how do you expect the CRA will uncover his secret stash? At most they can do lifestyle audit, i.e. look at expensive purchases (cars, real estate) and credit card expenses and see if that matches the declared income. If he is not dumb then there will be nothing out of the ordinary. And I assume he is not dumb if he managed to earn the money in the first place.

He's perhaps not exactly dumb, but he's left numerous documents in the house that raise some very pertinent questions.

If you had read my previous post, you should have realized that I hope for closure on this matter, whether or not it leads to financial gain.

[standing on the sidelines]

He's perhaps not exactly dumb, but he's left numerous documents in the house that raise some very pertinent questions.

If you had read my previous post, you should have realized that I hope for closure on this matter, whether or not it leads to financial gain.

if you are just looking for closure and not so much the money then all you have to do is let it rest

[caranna]

so called "Offshore accounts" are becomming harder and harder to hide these days. Switzerland is no longer as opaque as it was and the smaller countries that do offer real secrecy carry a risk as they do not usually abide by international fiscal laws which means getting info from them will be hard too.

Do yourself a favour and work out the cost benefit of how much you would have to find your ex has stashed to make the fishing expedition worthwhile. Then ask yourself if it is likely your ex has that kind of money there still. If the ex is sneaky and suspects you know what country it is in, why wouldn't the ex just move the cash to another country?

I won't be doing anything yet in that regard, as we're waiting for a reply letter from his lawyer. My lawyer had asked about the offshore accounts, among others. What is also in question is that he states he didn't receive a pension but I found evidence that may likely prove otherwise.

[caranna]

if you are just looking for closure and not so much the money then all you have to do is let it rest

I think you misunderstood...I am not looking for just closure...I am looking for unreported income, and if there is none to be found, I will rest assured that everything practical was done.

[Berner_Faith]

I think you misunderstood...I am not looking for just closure...I am looking for unreported income, and if there is none to be found, I will rest assured that everything practical was done.

So if nothing is found, who will be responsible for the costs associated for this fishing?

[caranna]

As I previously mentioned, I won't be acting in haste until I speak to my lawyer, and this will be after we receive his lawyer's reply letter. It's more likely he did receive a pension all these years, and I will likely focus on that matter more than the off-shore accounts. There is some reason to believe that he did withdraw the funds from the off-shore accounts quite some time ago, and with the requests to disclose his bank accounts information, the matters may be soon drawing to a close.

Thanks all for your replies. l found them to be really quite helpful.

[beebie]

I would recommend you phone CRA and get the information directly from them. I am surprised that CRA won't investigate on the basis on an ex-wife's information but I see the issue.

Often when the Court cannot establish how much money is in an offshore or out of country account they will unequally distibute the matrimonial property in Canada. However I think you would need to prove the offshore account was opened. Then the onus shifts to your ex to prove that there is nothing there.