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Many employees are facing thousands of dollars in back income taxes and interest charges after the Canada Revenue Agency (CRA) found that certain taxable benefits were not properly reported as employment income on the employees’ personal income tax returns, says an EY Tax Alert.

Read: How to deduct business expenses

Employers are also facing penalties and interest for failure to withhold and remit income taxes and the reporting of taxable benefits in their employees’ T-4s. Quebec is no different: Revenu Québec (RQ) has also been pursuing non-compliant employers and employees and assessing interest and penalties.

Taxable benefits such as automobiles, parking, gifts, fitness memberships, employer-provided housing, stock options, etc. often go unreported or are not properly valued. In some cases, the CRA/RQ has gone back and audited the individuals for the past four years, but in the case of employer payroll audits, the CRA/RQ can go back even further than four years.

Also read:

Cost of the company car

CRA launches plan to help small biz

Originally published on Advisor.ca

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