Cartoon businessman running away from tax collector

An advisor who previously received a conditional sentence for failing to report his commissions to the Canada Revenue Agency (CRA) has been sentenced to three years of jail time following an appeal.

Joern Scholz, also known as John Scholz, of Port Carling, Ont., was sentenced to three years’ imprisonment this month following the CRA’s successful appeal of his conditional sentence that was imposed in 2019, the CRA said in a release on Wednesday.

That year, Scholz was found guilty of one count of fraud over $5,000 under the Criminal Code for the evasion of federal income tax and goods and services tax/harmonized sales tax (GST/HST).

Scholz operated an investment counselling business and didn’t report on his 2011–2013 tax returns the commissions he received from his clients, the CRA had found during an investigation.

By failing to report taxable income totalling $2,149,730 for those years, Scholz evaded $605,355 in federal income tax, the CRA found. Scholz also failed to file GST/HST returns for the 2011–2015 tax years, evading the remittance of $445,789 in GST/HST.

The Court of Appeal for Ontario found that a prison sentence was merited because Scholz’s tax evasion constituted a large-scale fraud on Canadian taxpayers.

“Falsifying records and claims, wilfully not reporting income or inflating expenses can lead to criminal charges, prosecution, jail time and a criminal record,” the CRA said in the release.

Between April 2020 and March 2021, there were 36 convictions that involved 15 taxpayers sent to jail for a total of 26.2 years for wilfully evading $10,902,950 in tax, the agency said.