Monday, March 14, 2016 7:26 am, Posted by Absolute Destruction
March isn’t just a herald of spring. It also signals the beginning of tax season. With April 30th as the final day to file last year’s income tax return, the upcoming weeks can be busy for Canadians. As you begin to sort through your various T3s, T4s, and T5s, we thought it the appropriate time to remind you about how important it is to handle these documents with care. The personal information (PI) recorded on these slips can be used against you should they be found by the wrong kind of people. Criminals will stop at nothing to find and use your PI to file false returns and open dummy accounts, so you need to ensure you dispose of your information correctly.
As we reported last year, over 31,000 cases of identity theft were reported to the credit monitoring company Equifax in 2013. Unfortunately, according to the Canadian Revenue Agency (CRA), only 128 people were convicted of tax fraud in that same year, and only 23% of them ever saw jail time. This number may seem modest in comparison to those submitted by our neighbours to the south (the US saw 25 times as many convictions in 2013), but these 128 cases still managed to total over $32 million in losses.
Falsifying tax refunds is simple enough in this country. All one needs to file a tax return is a real name and an authentic Social Insurance Number (SIN). A thief can easily falsify the remaining documents they need to complete a return. As long as the name and SIN is legitimate, a false return won’t be flagged within the system. That means an identity thief can reap any rewards their doctored return grants them under your name, and if they’re good, these rewards are plenty. They can continue to file under your name until you notice a discrepancy or if it’s randomly chosen to be audited by the CRA.
The numbers are stacked against you, but they provide a necessary lesson. If you remain vigilant during and after tax season and keep your PI away from those who wish to commit tax fraud, you can stay safe. Any document you use to support your tax return should be filed carefully away from prying eyes. This includes any bills or receipts that include your contact information, financial account numbers, and SIN – even if you don’t need them for your income tax.
In fact, it’s important that you know exactly where you store your old tax returns and their supporting documents. Should your (genuine) return come under review, the CRA will request to see these files. If you can’t supply these documents, you could be fined for a false statement. To avoid that, the CRA requires you keep your past tax returns and their supporting papers on file for 6 years.
After those years, however, you can do as you please with them, but we suggest that you don’t throw them out with the rest of the recycling. Tax fraudsters look through garbage and recycling bins left out on the curb for exactly this information.
When you’re ready to throw out your confidential material, keep your important files out of the garbage. Instead, rely on our document destruction services to dispose of your paper. Our fully bonded service representatives destroy your material using our secure mobile shredding trucks, so we can shred all of your documents at your curb. Should you complete your taxes online, these trucks have the power to incinerate any digital media (like laptops, memory sticks, CD-ROMs, or external hard drives) that you’ve used to store PI. Whether it’s paper or electronic material, we can guarantee a certification of destruction and recycling.
If you notice you’ve kept tax information back dating to 2008 or earlier, it’s time that you give us a call. We can help you free up some space in your filing cabinet, and in the process, keep you safe from tax fraud.