Toronto Maple Leafs captain John Tavares is in an $8 million tax dispute with the CRA

Toronto Maple Leafs captain John Tavares is suing the Canada Revenue Agency over an $8 million tax dispute.

Court documents show Tavares filed an appeal with the Tax Court of Canada last week through his lawyers, seeking a reassessment of his 2018 tax return.

Tavares, a 33-year-old native of Mississauga, signed a seven-year, $77 million contract with the hometown Maple Leafs on July 1, 2018. He previously played for the New York Islanders from 2009 to 2018.

The contract included a $15.25 million signing bonus in its first year.

According to court documents, the CRA found in its reassessment that Tavares' 2018 earnings were $17.8 million higher than estimated and ordered the player to pay $6.8 million in taxes, more than 38 percent of the bonus — plus $1.2 million in interest.

The appeal says Tavares' signing bonus is entitled to a reduced rate of 15 percent under a provision of the Canada-U.S. Tax Treaty that sets lower rates for “incentives” paid to artists, musicians, actors and athletes. The claim has not been verified in court.

This report by The Canadian Press was first published on February 7, 2024.

Canadian Press