Heard of Tax Straddle?
Since the Covid-19 pandemic, more Canadians in need of extra cash might be targeted with schemes promising more money back on their tax return, and promising to reduce the amount of taxes they owe.
It’s a seductive, creative way to convince people that they can get tax-free income or a large deduction.
A straddle scheme involves trading foreign currency with contracts. Essentially the contracts create a loss that offsets a gain. Using this method, taxpayers can offset their tax gains with a new loss every year. It is a complicated and organised scheme generally executed by individuals or companies.
The CRA warns to not get involved in this high-risk activity. There are serious consequences for those participating, including fines, court time and jail time. These actions are detrimental to the resources provided to benefit all Canadians.
It’s important to keep proof of any claim that is made and to seek advise from a reputable tax professional on important tax related matters.