A solely owned corporation performed services for a customer over a two year period. The owner pocketed the money and did not report the revenue nor the GST collected. CRA learned of this and reassessed the corporation for collecting the revenue and not remitting the GST.
The taxpayer had to pay the income taxes on this money AND the GST that was collected. Penalties of 100% of the income taxes evaded and the GST not remitted were applied.
The taxpayer was sentenced to 12 months in jail if he did not pay the CRA $837,859. Another 12 month sentence was ordered if other certain conditions were not met.