PayPal ordered to disclose business accounts to Canada Revenue Agency

Online payments company has 45 days to hand over information identifying its account holders

The records of Canadians who use PayPal business accounts to make and receive payments will soon be in the hands of the federal government’s tax-collecting agency.

The online payments company said Wednesday it has been given 45 days to hand over information identifying its account holders and the amount and number of payments they paid or received between Jan. 1, 2014, and last Friday to the Canada Revenue Agency.

“We are required to disclose information about business account holders who have received or sent a payment,” it says on its website. “Affected account holders have been notified.”

CRA spokesman Patrick Samson confirmed that the agency received Federal Court of Canada authorization to request the information, part of a crackdown on Canada’s underground economy.

“Specifically, the CRA is seeking PayPal’s list of Canadian clients who have a commercial account, including the total value of their transactions (purchases and sales) from 2014 to the date of the requirement,” he said.

“The information obtained through the unnamed persons requirement will allow the CRA to ensure that these individuals and corporations comply with their tax obligations under the Income Tax Act.”

PayPal Canada says it has more than 6.4 million active users, although that includes personal accounts which are not affected by the CRA move.

Hussein Warsame, a tax professor with the University of Calgary’s School of Public Policy, linked the data grab to the federal government’s 2017 budget, which provided a five-year funding boost to the CRA to fight tax evasion by investigating the underground economy.

“They think people who use PayPal are probably avoiding tax and therefore they’re using the extra funding to basically look for low-hanging fruit,” he said.

“It is a fishing expedition, in many ways.”

He said the agency is likely offering the 45-day window to allow people who haven’t paid their taxes as required to file tax revision forms and come back into compliance with the tax act.

Warsame said the files could allow the CRA to identify people who have had more than $30,000 in business revenue over 12 months, which means they should be registered to collect and remit the GST.

It also may identify people or corporations who owe corporate or personal income taxes. If caught, they will have to pay the tax, plus penalties and interest. If the tax avoidance is deliberate, it could be considered tax evasion and result in a criminal charge, he said.

He said Canadians are required to retain tax records for six years and recommended that PayPal customers pull together their records to prepare for potential audits.

Dan Healing, The Canadian Press

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

Spruce Hill Resort shut down for not following COVID-19 protocols

Guests told to leave immediately Wednesday evening, owner insists shutdown only temporary.

Fire hose testing, pump refresher successful

South Green Lake Volunteer Fire Department pressure-tested all of the department’s spare fire hose.

Mt. Timothy anticipates one of its busiest seasons

General manager Walter Bramsleven said the ski hill has improved its facilities and infrastructure.

Citing stability, B.C. Premier calls snap election for Oct. 24

John Horgan meets with Lieutenant Governor to request vote

B.C. reports 91 new cases as officials remain worried over ‘clusters of COVID-19

There have now been a total of 8,395 cases in B.C. since the pandemic began

Four more cases of COVID-19 in Interior Health

There are 31 active cases in isolation in the health region

Canada’s active COVID-19 cases top 10,000 as daily new cases triple over the past month

Dr. Tam repeated her warning to young people, who have made up the majority of recent cases

First 8 months of fatal overdoses in B.C. have now exceeded 2019 death toll

Nine people died every two days in August, BC Coroners Service data shows

Is it time to start thinking about greener ways to package cannabis?

Packaging suppliers are still figuring eco-friendly and affordable packaging options that fit the mandates of Cannabis Regulations

Join Black Press Media and Do Some Good

Pay it Forward program supports local businesses in their community giving

Liberal effort to reset policy agenda panned by rivals as too much talk, not action

Trudeau said it’s ‘all too likely’ families won’t be able to gather for Thanksgiving next month

‘Show us the money’ for cannabis, local governments tell B.C.

Municipal tax, transit revenues falling as costs rise

‘It’s a boy’: Southern Resident killer whale calf born to J Pod is healthy, researchers say

J35 had previously done a ‘Tour of Grief,’ carrying her dead calf for 17 days

Most Read