Dentist pleads guilty to tax evasion
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Updated: July 12, 2009 5:02 AM
Salt Spring dentist Robert McGinn received a six-month conditional sentence in Duncan Provincial Court on Tuesday after pleading guilty to income tax evasion.
According to a Canada Revenue Agency press release, McGinn's sentence includes 100 hours of community work service and a $13,181 fine, representing 50 per cent of the federal tax evaded.
A CRA investigation revealed that McGinn sold his dental practice in 2000 and began working on a part-time basis as a dentist for the new owner. In November 2002, McGinn entered into a contract for hire with the owner as a "natural person" and instructed that cheques for services be payable to "Robert McGinn, natural person." McGinn then opened a personal account at the Bank of Montreal, registered in the name "Robert McGinn, natural person" and refused to provide his social insurance number. From 2003 through 2005, says the CRA, McGinn failed to report $179,544 in income earned for dental services provided.
McGinn eventually provided banking records that revealed the unreported income. He had stated that the "taxpayer" had not earned any income but rather "Robert McGinn, natural person" had earned income for their benefit.
In a statement McGinn said "From 2003 - 2005, after careful consideration of the Canadian Income Tax Act, I made the decision to arrange my affairs in such a way as to exempt myself from certain taxes. I acted in a way that I believed to be legal and I did it openly as a challenge to the Income Tax Act itself. Subsequently, I repeatedly communicated with CRA, asking them if what I had done was correct. They never answered my questions."
"In January of 2009, a Court finally ruled on a similar case, and although that decision is under appeal, I decided to accept the decision as law. I immediately contacted CRA and agreed to pay all of the taxes and penalties requested. Unfortunately CRA decided to charge me with evasion of income tax. I pled guilty because a court case could have meant greater penalties."
The CRA states that "when individuals are convicted of income tax fraud, they must still repay any amounts fraudulently received, plus interest and any civil penalties that may be assessed by the CRA. In addition, the court may fine them up to 200 per cent of the refund sought and impose a jail term of up to five years.”
McGinn was, but is no longer a longtime Member of the Board of the Salt Spring Monetary Foundation which produces Salt Spring Dollars.
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