The Canada Revenue Agency (CRA) is increasing eligibility, updating the relief amounts and changing the documents required to participate in the voluntary disclosures program, the tax agency announced Wednesday.
The program lets well-intentioned taxpayers voluntarily correct unintentional filing errors or omissions and receive some financial relief.
The following changes will come into effect on Oct. 1.
Taxpayers who receive notification from the CRA about a potential non-compliance issue could now be eligible for the voluntary disclosures program. But those under audit or investigation and those who were egregiously or intentionally non-compliant will still be restricted from accessing the program.
Voluntary applications will be eligible for two types of relief. General relief of 75% interest relief and 100% penalty relief will be available to those who applied and have had no prior compliance communication from the CRA. Partial relief of 25% interest relief and up to 100% penalty relief will be available to those who applied after receiving a compliance notice.
Applications under information circular IC00-1R7 involving non-compliance over multiple years should include the most recent 10 years of foreign-sourced income or assets and most recent six years of Canadian-sourced income or assets. Applications under GST/HST memorandum 16-5-1 over multiple years should include the most recent four years of GST/HST information.
The new policy is written in plain language, as is the application process and form. The application process is available electronically.
While spreading the word about the new policy, the CRA is also reminding taxpayers that it does not reward non-compliance. Taxpayers who use the program will not receive relief that puts them in a better financial position than if they complied with tax rules from the start.