Notice of Reassessment on an In-active Business

[Qmx323]

My mother bought a convenience store (both store lot and franchise) back in about 2006, and sold the store lot in 2007, and basically stopped all franchise activity. All tax returns during the time period where we were making income were properly filed and sent to the CRA. Since the franchise is no longer making income, is the CRA allowed to fine us in not filing taxes because even if we did file them, the numbers would all be zero?

She received letters a few months ago stating that because the franchise is not reporting income, the CRA is no longer recognizing the franchise as active, and subsequently told her to return the "certificate of registration". However because she cannot read (or speak) english very well, she only noticed the first part about the franchise now being inactive and closed, and just ignored it.

Last week she received a letter stating a reassessment, and was basically telling her she owes the CRA money, to be repaid VIA some CIBC branch on West 8th street in Vancouver. However the letter did not state the specific amount she owed, it only stated that the amount would not be over 4134.79 dollars.

Because she has no intention of re-opening the franchise, is it possible to declare this franchise bankrupt and avoiding to pay the reassessment fees, then return the certificate of registration and thus shutting down the franchise permanently?

Or would declaring bankruptcy for the franchise affect her personal credit status as well?


Q "Wishes he was a lawyer" mx323.

edit: NVM, can't be declared as bankrupt because its a limited franchise.

[Gt-R R34]

Not about lawyers, more look for an accountant.

If you're planning to declare bankruptcy for the company, any identifiable assets related to herself? Something she declared on her business but in reality it was personal. I'm sure if you're trying to just not pay the 4.5K, CRA Audit will come and probably rip you guys apart if they choose to look at all your records.

You do understand last 7 years of all business dealings can be re-assessed and re-audited and if you don't have all your records, you're in for a big screw job for yourself.

For being cheap.

[Qmx323]

Originally Posted by Gt-R R34

Not about lawyers, more look for an accountant.

If you're planning to declare bankruptcy for the company, any identifiable assets related to herself? Something she declared on her business but in reality it was personal. I'm sure if you're trying to just not pay the 4.5K, CRA Audit will come and probably rip you guys apart if they choose to look at all your records.

You do understand last 7 years of all business dealings can be re-assessed and re-audited and if you don't have all your records, you're in for a big screw job for yourself.

For being cheap.

No, the business was very small-scale, no assets were declared thru the franchise. She does have all records up to the stoppage of business activity (Mid 2005 to Aug 07)

Not trying to be cheap, just not get fucked out of 4.5k for an inactive non-functioning business that the CRA even recognized as "Closed"

[Gt-R R34]

Onus is on yourself to do what you need to do when you run a business.

CRA has every right to charge if you didn't return your company registration, as you could pretty much have last year or 2 - Run a business but not declared as you "technically" could still do business atleast to customers as you have "proof" of business. Anyways thats just a technicality.

My advice would be go see an accountant instead, they probably could hammer something out for you better then a lawyer, or cheaper then a lawyer. Tax lawyers = bling.

Edit: CRA can recognize that it is closed but they can still re-assess anytime within the 7 year window.