Think tax season in Canada can’t get any more stressful?
Think again. For scam artists, 'tis the season to be jolly. After all, the tax season is a golden opportunity for these grubby crooks to make big money off unsuspecting tax-payers.
Is it really a surprise? We make ourselves pretty easy targets around this time of the year. Because let's face it - for the average person, trying to understand tax lingo is like trying to decipher moon-runes. And it's only human nature to be more gullible when we're intimidated.
Scam artists understand all that much too well.
But fear not, for most tax scams are easily preventable! You know what they say - knowledge is power. Here's what you need to know to avoid becoming a tax fraud victim.
1. Tax Preparer Fraud
There are many tax preparers out there that undergo rigorous training and bust their backs in legitimate preparation agencies. They live by a code of ethics, and will do everything they can to deliver you the tax return payment you deserve! The last thing they'd want to do is use your personal information for personal gain.
That's the way it should be, at least.
Unfortunately, there are people out there that pose as trusty tax preparers to take advantage of good people. Unlicensed and untrained, these malicious wanna-be's often prey upon people in unfortunate circumstances, such as the elderly, the disabled, and low-income workers. Those frauds promise them amazing refunds and instant payouts, ultimately snagging their personal information to work their evil.
That's right - they're capable of filing your tax return, and keeping the return payment for themselves! And to make matters worse, they may even file it with inaccurate numbers to get a bigger refund than you're allowed - all of which will be going into their wallets. And when the CRA discovers what's been done, they'll be asking for that money back.
And guess who's going to be responsible for paying for it?
Here are couple of things you should keep in mind when you're looking for tax preparation services:
- Watch out for any 'tax preparers' that charge a percentage of your refund, instead of a flat fee.
- Personally review a return to ensure the information the preparer put down is accurate - especially when it comes to your deductions and income claims.
- If a refund seems too good to be true, then it probably is!
2. Phone Scams
This is a type of hustle that everyone is pretty familiar with. In fact, you've probably heard the stories with this one: phone scammers tricking the elderly into handing over massive amounts of cash, crooks coercing an unfortunate couple into signing up for unwanted subscriptions, and so on.
Sure, those unfortunate victims might have been gullible and naïve. But some scam artists have the personality and voice that are as smooth as a batch of freshly churned butter. You'd be surprised at what they're capable of - especially AFTER they take all your personal identification information and drain you of your money.
Seasoned scam artists will also do their research to make themselves appear credible. So don't be surprised if a caller has your address, workplace information, and more. With the advent of the Internet and social media, people can find out a lot more about you than you'd think!
Some scammers may even be able to rig the call so that the phone number appears to be from legitimate government offices. So don't go trusting your Caller I.D., either!
Instead, just keep in mind that the CRA will NEVER call you to:
- Ask for over-the-phone payment
- Discuss any tax matter without sending a bill or a statement
- Threaten you with arrest
- Deny your right to an appeal for taxes owed
Chances are, you've already been subject to hundreds of phishing attempts. Don't believe us? Just check your junk mail, and see for yourself!
Most of them may seem extremely obvious, as they're ridden with typos and grammar mistakes, and written in the most atrocious typeface that physically hurts to read.
But what if it wasn't so easy to tell? What if a bogus company sends you a polished, well-written e-mail, and leads you to a website that looks exactly like an official tax preparation service, or a CRA page?
Those are the ones you have to watch out for. Sophisticated phishers may claim that you've made mistakes on your tax return, or forgot to claim your refund. They'll prompt you to enter your information or log in to their fake website - all to get their grubby hands on your precious personal information.
At that point, you might as well consider your identity stolen. There's just so much damage they could do with your information! For one, they could easily file a tax return in your name and claim your refund for themselves.
The CRA will never:
- Ask you to give out personal and financial information
- Send an e-mail containing links, unless you've asked a CRA agent to forward information to your e-mail during a phone call
Stay Safe This Tax Season
You're now aware of the most common tax scams these crooks have hidden up their sleeves! But don't ever rest easy, because they'll always be thinking of different ways to get at your hard-earned tax dollars.
So stay vigilant, and proceed with caution! And if you're ever in doubt, consider calling the CRA directly using the number provided on their website. Their agents are there to answer whatever you may be unsure of!
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