How to Identify Tax Credit Scams in Canada

As a company that works closely with Canada’s disability community, we’re highly aware of, and sensitive to, tax credit and online scams that prey on unsuspecting, disabled Canadians.

We, at The National Benefit Authority, feel it’s important that Canadian tax payers understand how to detect fraudulent tax credit service provider scams. To help spread awareness and important information to the community, we’ve identified some of the most common tax refund and fraud scams in Canada.

You’ll learn how to easily pick out a tax refund scam, and how you can confirm you’re working with a legitimate tax credit agency.

Common Tax Refund Scams

Many scams take advantage of unsuspecting Canadians by masquerading as well-known and trusted institutions like the Canada Revenue Agency or The National Benefit Authority.

These usually come in the form of e-mail scams, better known as phishing scams, which is a form of online identity theft.

Here’s one of the most recent ones that sprung up this past tax season:

The subject line reads, ‘Tax Return File Overdue’, meaning they’re trying to extort money from the victim by alleging they owe outstanding or incomplete tax returns.

These scammers clearly put in the effort to appear genuine, providing a link that leads to a page that looks almost identical to the CRA’s official site. The page asks for personal information – information that the CRA would likely have on file if it was a legitimate request.

This type of scam – or CRA scams – have been around since 2013, but they’re more sophisticated and convincing than lazy phishing efforts of the past.

Other email scams usually involve a notice of a tax refund, where the victim sends their personal information in return for their unclaimed ‘refund’.

Scam phone calls are similar to email scams. This involves a person posing as a CRA employee, explaining to the victim they made an error on their tax return or forgot to file it. These scams can seem extremely credible, complete with a phony caller ID.

Business scams involve people mimicking real businesses to deceive that business’s existing consumers. These types of scams typically target small businesses, coming in the form of wire fraud, extortion scams, office supply scams, directory scams, and sale of merchandise scams.

These are only a handful of tax refund scams in Canada – there are many more, coming in many forms. Telemarketing scams, text message scams, door-to-door scams and more, have all threatened Canada’s disabled community.

The Disability Tax Credit service providers in Canada now work on a contingency model, meaning it is success-based. There are no upfront fees; they will only charge you a percentage of the successfully claimed retroactive refund. If they do not help you retrieve your credits, they do not get paid.

Be wary if you get charged upfront just to determine Disability Tax Credit eligiblity, or if you have to pay a fee when you find out you’re not eligible for the Disability Tax Credit.

As always, remember to read the fine print before signing any contract with a company.

How to Recognize Online or Tax Refund Scams

To protect yourself against CRA scams, tax refund scams, and other online scams, we encourage you to keep these guidelines from the CRA handy:

• If you receive a call saying you owe money to the CRA, you can call the CRA directly, or check My Account to be sure.

• If you’ve signed up for online mail with the CRA, they will do the following:
  • Send a registration confirmation email to the address you provided for online mail service for an individual or a business; and
  • Send an email to the address you provided to notify you when new online mail is available to view in the CRA’s secure online services portal.

The CRA will NEVER:

• Ask for personal or financial information by email, text, or an online link
• Ask for information regarding your passport, health card, or driver’s license
• Share your taxpayer information with anyone
• Send payments via Interac E-Transfer (payments are done through direct deposit or cheque ONLY)
• Request payments by gift cards or pre-paid credit cards

If you’re still uneasy about who you’re dealing with, ask yourself:

• Does this sound too good to be true?
• Is the person asking for details I wouldn’t include in my tax return?
• Are they asking for information the CRA already has on file?

For anything online, ensure any URL provided actually links to where it says it does. This can be seen by simply hovering your cursor over the link, and seeing the actual link you’re being led to.

If it looks fishy, it probably is.

How to Identify Legitimate Businesses

One of the easiest ways to determine if the company you’re working with is legitimate is to see if they’re on the Better Business Bureau’s site. As you can see on our BBB page, the agency details everything you need to know about the business, including customer testimonials that factor into each company’s composite score.

Another way to pick out genuine businesses is to do a quick and search on Google or Apple Maps to see if they have a real, physical location, and a number you can call for verification. You can also search for any social media accounts on Facebook, LinkedIn, Twitter, and Google Plus, to see how active their accounts are, and to gain a deeper understanding of their involvement with clients and the community.

Some scammers will go so far as to create websites to add credibility to their long con. You can see if they’re fake by going through the text; if there’s tons of grammar or spelling mistakes, it’s likely illegitimate. Even the images can be a tell, with incorrectly sized or grainy images as potential red flags.

To identify a legitimate Disability Tax Credit service provider in Canada specifically, the best resource is the Association of Canadian Disability Benefit Professionals (ACDBP), comprised of 14 organizations across the country that are committed to improving the livelihood of disabled Canadians. All organizations in ACDBP follow a business code of conduct, which ensures that these organizations provide the best services available for disabled Canadians across the country.

If you’ve been the victim of a tax refund scam or online scam, you should contact your local police service. You should report deceptive telemarketing to the Canadian Anti-Fraud Centre online, or by calling 1-888-495-8501.

For authentic assistance with your Disability Tax Credit claim, The National Benefit Authority has helped over 40,000 Canadians successfully receive their Canadian disability benefits. We’re backed by thousands of testimonials, and an A+ rating from the BBB!

Contact us today to learn more!

Sources:

The Government of Canada (Canada Revenue Agency): https://www.canada.ca/en/revenue-agency/corporate/security/protect-yourself-against-fraud.html

Canadian Anti-Fraud Centre: http://www.antifraudcentre-centreantifraude.ca/fraud-escroquerie/index-eng.htm

Global News: http://globalnews.ca/news/3225702/canada-revenue-agency-email-scams-tax-season/