Cash Jobs & Bank Accounts

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FYI, there is no actual $ amount threshold that gets you automatically reported to FINTRAC. Its all up to the discretion of the bank or financial instituion employee, they could flag $1000 transaction if they beleive it to be fraudlent or sketchy.

With many people now a days having different accounts at various banks, its not that uncommon to be depositing $500-$700-$1000 into your bank account. Go to various different bank machines and grab a few diff envelopes from each of them, when depositing the cash into the bank, put the cash in A bank enevelope if depositing into bank B etc...

However, my advice is to just declare it-- CRA is someone that you dont want on your case, or at a min, keep whatever amount you would have to pay tax aside, just in case you do ever get audited.

There are a lot of tax breaks in regards to running your business, from writing off expenses, education, tools, etc.. that would probely offset the amount of tax you would have too pay anyway. It also gives you experience at doing things that you can use in your everyday life or working career down the road. Stuff like tracking payments, invoicing, accounting, general ledger accounts.. so on.

If you are in construction or trade ends of things, it will also bring you work, many people are turned off by cash jobs because there is not accountablity after the job is done, even if you just start off small, like painting, handyman(women) stuff, you never know were it will go and if you have a legit company with proper invoices etc.. it will lead to you getting more work.
 
twinn said:
FYI, there is no actual $ amount threshold that gets you automatically reported to FINTRAC. Its all up to the discretion of the bank or financial instituion employee, they could flag $1000 transaction if they beleive it to be fraudlent or sketchy.
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FYI there is a LEGAL requirement to report any deposits or transfers of over $10k to FINTRAC in a 24hr period. Failure to do so will result in a 100k individual or 500k institutional fine.

http://www.fintrac.gc.ca/reporting-declaration/1-eng.asp
 
Cash businesses and trades have the highest probability of audit selection. I believe general contractors have an obligation to report payments to trades as well - so yeah, they're happy to pay cash if they get a better price, but they'll be reporting the payment to the CRA. I've had HST auditors leave with a bunch of photocopied receipts from expense reports. As someone mentioned, keeping on top of income and deductible expenses is a good idea - if you don't, you may misplace or lose receipts to support those expenses. Normally, CRA will only be concerned with receipts of cash and tax you on that, plus penalties of 50-200% of the tax liability, interest - both are non-deductible and the possibility of jail time. It is ruinous!

When I pay someone cash for something, I have them sign an acknowledgement of receipt of cash. That way, if they or someone else, such as spouse, estate, trustees in bankruptcy come knocking on the door, I have proof of payment. Finally, if you're dealing with someone who's stealing from the government, chances are, they're probably going to steal from you in one way or another.
 
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LiNK666 said:
FYI there is a LEGAL requirement to report any deposits or transfers of over $10k to FINTRAC in a 24hr period. Failure to do so will result in a 100k individual or 500k institutional fine.

http://www.fintrac.gc.ca/reporting-declaration/1-eng.asp
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Yes, they have to do a mandatory report for 10K transfers. However, there is no actual limit in terms of being reported to FINTRAC, they can report you for $700 as well as $5000 etc.. its all up to their discretion.
 
if its a ligit job where you get paid cash, deposit any amount you like, Financial institutions will report 10K movements but if you have a real story its not a problem, you get CCP records, have access to credit and show income. Be careful to skim , if your source of cash gets audited they may look down the chain.
Waitresses ect get cash tips, a portion they claim to stay on top, stuff that is credit card based needs to be reported though little is. The reality is the auditors are not chasing 18k per yr diner servers, bigger fish pay better for auditors.

if we are talking a small cash job like building decks/fences or home renos and getting 2-5k at a time just pay cash for gas, groceries, dinners movies and life expenses, put it into the system $100 at a time. If you buy a new helmet at $900 and pay cash, the store is used to depo'ing 5-8-15k every week or daily at thier financial institution and never an eyebrow is raised.

if its a legit paycheck treat it as such, you'll be much better off long term. I have several friends in total cash businesses with impossible to trace sources and its way less trouble to stay legit.

Strangely putting 100k into the "system" as clean is not that hard.
 
FYI - A teller has to report a "suspicious" activity report for ANYTHING unusual. You can be making $500 deposits and it still raises red flags. All banker have to adher to anti-money laundering guidelines. The $10 limit is when it is mandatory to fill out the report. But they can fill it out for anything. And I wont give out tips on how to launder money even tho I know how.
 
I like to move my parents' money around a lot to places with better interest (large sums)... they don't want to invest in stock market etc... so the second I find a place with a few points higher I go there. They always get reported to fintrac and I laugh everytime I'm asked to provide a trail of where the funds came from. Usually the bank reps are confused when I show them the trail and I make jokes saying "this is how you launder money"

Honestly, the government knows about all these methods that have been mentioned here. If it's a small amount of cash i.e. under $10k they won't audit you since it'll cost more to audit than it's worth, but if it's over 50k you can expect the audit and they know what they're doing. They will rape your *** in an audit.

Best advise is not to do it, but if you're intended on doing it... hire an accountant that'll do it for you through loop holes etc...
 
My friend thanks you guys for the replies. :D

- First-off, building credit is a non-issue as he has 2 other regular direct deposits. But what worries him is that he's always used debit for purchases. It seems obvious that the 2 other paycheques are getting smaller, the debit card barely has any transactions now, and money seems to just be getting deposited. The only way to minimize this would be to deposit and continue using debit...but that's still suspicious, imo.

- I know a dude that's an accountant at a really big financial firm and he said that they tend to be less suspicious of the tax-frees. So it's not a real solution, but it has better chances. I still have to look into the veracity of it, but I'm sort of skeptical. But then again, dude isn't the type to talk out of his ***, so I'd imagine that there's some type of truth to it.

- He did think of using relatives, but we also imagine that this gets old real quick. I mean, he won't be able to do this for very long.

- A home/personal safe isn't a viable solution imo because it wouldn't offer the security of a bank/digitizing money.

Is the CRA really that vigilant? Like crankcall said, the only reason he's even considering this is because while the gov. probably knows what's up, there are probably WAAAAAY "bigger fish to fry".
 
knowledge said:
My friend thanks you guys for the replies. :D

- First-off, building credit is a non-issue as he has 2 other regular direct deposits. But what worries him is that he's always used debit for purchases. It seems obvious that the 2 other paycheques are getting smaller, the debit card barely has any transactions now, and money seems to just be getting deposited. The only way to minimize this would be to deposit and continue using debit...but that's still suspicious, imo.

- I know a dude that's an accountant at a really big financial firm and he said that they tend to be less suspicious of the tax-frees. So it's not a real solution, but it has better chances. I still have to look into the veracity of it, but I'm sort of skeptical. But then again, dude isn't the type to talk out of his ***, so I'd imagine that there's some type of truth to it.

- He did think of using relatives, but we also imagine that this gets old real quick. I mean, he won't be able to do this for very long.

- A home/personal safe isn't a viable solution imo because it wouldn't offer the security of a bank/digitizing money.

Is the CRA really that vigilant? Like crankcall said, the only reason he's even considering this is because while the gov. probably knows what's up, there are probably WAAAAAY "bigger fish to fry".
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Government is getting low on cash and don't want to raise taxes so they're going after fishes they didn't normally go after before. Sounds like he has a LOT of extra cash. Have him buy a junk house on 5% down and upgrade the **** out of by paying cash labour and then sell the place for a price that reflects the upgrades.

Unless he makes crazy *** purchases that'll catch the eyes of people around him he should be fine. He can go out and party a lot with the cash if he wants. Don't do the casino trick it'll fail.

Tell him to keep the cash hidden at his place and slowly consume it.
 
knowledge said:
I know a dude that's an accountant at a really big financial firm and he said that they tend to be less suspicious of the tax-frees. So it's not a real solution, but it has better chances. I still have to look into the veracity of it, but I'm sort of skeptical. But then again, dude isn't the type to talk out of his ***, so I'd imagine that there's some type of truth to it.
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Wonderful advice. :rolleyes:

Perhaps he should familiarize himself with CRA's third party penalties.

So little to gain and so much to lose.
 
LiNK666 said:
Government is getting low on cash and don't want to raise taxes so they're going after fishes they didn't normally go after before. Sounds like he has a LOT of extra cash. Have him buy a junk house on 5% down and upgrade the **** out of by paying cash labour and then sell the place for a price that reflects the upgrades.
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This isn't a bad idea. I kinda like it actually. You're smarter than you look Link.....
 
Flashmonkey said:
This isn't a bad idea. I kinda like it actually. You're smarter than you look Link.....
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Until your house is seized through proceeds of crime legislation. Think about what you're using your home to do. Is it worth the risk? What sort of defensive position do you intend to take to mitigate losses in the case of any downside? CRA is quite aware of all the schemes and has a formidable tool chest to detect them. Have you considered the cost of lawyers and accountants? CRA isn't too concerned whether you're a big or little fish - they reel them all in.
 
Flashmonkey said:
This isn't a bad idea. I kinda like it actually. You're smarter than you look Link.....
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Have we ever met?

I'm good with money.... :D

Edit: Btw if you want to go that route there is a lot more involved than just buying, upgrading and selling. You need to avoid capital gains tax etc...
 
promac said:
Until your house is seized through proceeds of crime legislation. Think about what you're using your home to do. Is it worth the risk? What sort of defensive position do you intend to take to mitigate losses in the case of any downside? CRA is quite aware of all the schemes and has a formidable tool chest to detect them. Have you considered the cost of lawyers and accountants? CRA isn't too concerned whether you're a big or little fish - they reel them all in.
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This depends on how much money is being used doesn't it? I mean, if you're in a position where you can drop $70k as a downpayment on a house, in cash, then your problems are on a level that I can't even comprehend haha.

I'm not even sure how much money we're talking about in this thread. If your friend is constantly having trouble figuring out what to do with the tens of thousands of dollars lying around in his mattress....well...I'm not sure what kinda of advice we should be giving out. Hiring a good accountant would probably be the best bet here...if you want to go the legal route anyway.

I do, however, like the idea of investing in property whenever possible. It doesn't have to be fancy, but tying up extra cash in an investment is usually better than dumping it off in a bank somewhere....was the basic summary of my previous post :p
 
I've made several large deposits when buying/selling vehicles for cash and have never run into a problem. I just use the bank machines. Not very close to $10k though.
 
Unless you can account for the money legitimately, or launder it well, don't deposit unclaimed income into any financial instituion unless you have supporting documentation as to how you obtained that money.

Any other advice is a liability.
 
With CRA, cash businesses have the highest incidence of review/audit - it's the nature of the beast. Add to that an extraordinarily large tax free capital gain and you're pretty much guaranteed a visit and the scrutiny begins. It's really a no-brainer for them. Do you think you're going to beat CRA at their own game? LOL! If GF or wife know about it, she might rat you out if you piss her off. It happens - LOL!
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