Who Falls for CRA Scams? People as Smart as You


Ah good old CRA scams. There is one going on right now – a revival of one that’s been floating around for the last couple of years. The phone rings. A recorded voice greets you. Oh no! The police are practically at your door because tax fraud! The only way to avoid jail time and having a criminal record is to send a bunch of gift cards to an address that will be provided to you. And don’t tell your family or any friends, because this deal is hush-hush to help you avoid prosecution. Eye roll, right? Who falls for these scams? Go ahead and pat yourself on the back, right after you finish filling in that super fun Facebook survey that says, “your maiden name and birth date determine which wizard you’d be in a past life.” Oh, and don’t forget about that guy in the basement “inspecting” your furnace on behalf of “Energy Efficiency Big Corp.”

The fact is, scammers are smart and are getting smarter every day. While the classic CRA gift card scam may seem ludicrous to you, imagine how it feels to someone that is struggling to pay their taxes, or that has actually received legitimate CRA late or actionable notices in the past. Many people fall victim to the scam because they simply want their tax problems to go away. Buying gift cards sounds like an easy way out.

How to Recognize and Avoid a CRA Scam

The gift card scam is just one of many CRA scams to watch out for. There are also:

The donation scam: You are told to expect a huge tax break for your donation to a certain charity. Giving money to charity! What could go wrong? It goes horribly wrong when CRA alerts you to the fact that you have lined the coffers of a tax shelter. Your money is gone, you are in big trouble, and the charity didn’t exist in the first place.

To date, this scam has initiated more than 190,000 reassessments, and resulted in $6.3 billion donation claims being denied.

Avoid the donation scam by knowing that CRA has firm limits on donation tax credits.  Any charity promising more than that is not being truthful.

The phone phishing scam: The phone rings and the caller tells you they requires personal information, such as your birth date and bank account number, to settle your outstanding CRA debt. He or she may even rattle off a CRA employee number, and stress that he or she got your number from your CRA file.

This scam bilks millions of dollars from Canadians every year. Too many people live in fear of a legitimate call from CRA if they owe taxes, and scammers prey on this fear.

Avoid the phone phishing scam by hanging up and calling CRA yourself to ask about your file. If the caller leaves an employee number, write it down and report it to CRA. Remember that CRA does not ask you for information that is on your tax return unless you called them and they are using that information to verify you as a caller. Never be afraid to hang up if you think the call if fraudulent.

The email phishing scam uses a similar method, but sometimes tells the victim that CRA is giving them a huge return or refund. Just send in your personal details…

CRA Scams Count on Your Emotional Response

avoid CRA Scams

Avoid CRA scams by not falling victim to the immediate emotional response. If you owe money or need money and are promised huge returns for just giving up personal information, the scam seems very tempting. What you are left with, however, is an empty bank account, compromised identity, and even more stress than before.

AF Accounting is the source for all your small business accounting needs. For tax and small business advice, stay tuned to our blog.


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