CRA reviewing Home Depot commercial credit card records in underground economy crack-down

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Ontario Construction Report staff writer

The Canadian Revenue Agency has obtained a court order to obtain information about Home Depot commercial credit card holders in an initiative to crack down on the underground economy.

Global News reports that the company sent out letters to customers who have a commercial credit card account, notifying them Home Depot would be handing over information including business names, addresses and purchases between 2013 and 2016 to the agency.

“Rather than having to contact individual taxpayers, they can go after one broad source and this will allow the CRA to detect who they think they should be auditing,” tax lawyer Cuelenaere LLP’s Lane Zabolotney told the broadcaster.

While Home Depot fought the order over the summer, it is complying with the judge’s decision.

In an emailed statement the company said, “multiple home improvement retailers received requests for customer information from the CRA, and when The Home Depot Canada received such a request for information, it not only disagreed with but pushed back on the CRA request for over three years.

“Following the ruling of the courts affirming the right of the CRA to require such information from retailers, The Home Depot Canada complied with the Federal Court order and the law.”

Zabolotney said the CRA will look for patterns in suspect tax returns.

“They will look at someone in a certain industry and they will look at their spending habits and they will say, ‘Hey. This person’s spending habit, it differs from what most people are doing. And their revenue and their expenses don’t line up.’ And they’re going to investigate it further and do an audit,” he said.

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