A former Nanaimo financial business consultant has incurred a $6,000 fine by the Canada Revenue Agency.
Frederick James Lewis, who now resides in Calgary, was found guilty of two counts of income tax evasion. He was fined $3,000 per charge. The fines represent 65 per cent of the federal income taxes evaded.
A press release citing court records indicates a CRA investigation determined that Lewis did not report shareholder appropriations of $72,630 for the 2002 and 2003 taxation years.
Documents revealed he was reimbursed from Skystone Management Inc., a company he co-owned, for personal expenses including his daughter’s wedding, sport fishing supplies, a flat-screen TV, clothing, and expenses claimed by his proprietorship, Skystone Consulting.
The company had no income between 1998 and 2005 and raised funds from local investors and private lenders totalling $2 million.
The investors were primarily residents of Nanaimo and Vancouver Island. Some were promised a 12-per cent interest rate of return and up to 10 times their initial investments. However, they received little or no money.
When taxpayers are convicted of income tax evasion, they must still repay the full amount of taxes owing, plus interest and any civil penalties that may be assessed by the CRA. In addition, the court can fine them up to 200 per cent of the taxes evaded and impose a jail term of up to five years.
Taxpayers who have not filed returns for previous years, or who have not reported all of their income, can still voluntarily correct their tax affairs.
More information can be found at www.cra.gc.ca.