Feigenbaum Law

Canada Revenue Agency Further Extends Deadlines and Exemptions

Business Management
Cross-Border Tax Issues
Personal Tax Planning
October 2, 2020

It has been a few weeks since we last updated our readers on how the Canada Revenue Agency is continuing to react to the COVID-19 pandemic. There were a number of announcements made in September that will be of interest to business owners as well as Canadians and Americans who spend time in one another’s country.

Extension of Travel Restrictions Relief

On September 2, the CRA announced an extension to their travel restrictions which could cause impacts to taxpayers. Relief for travel-related tax issues will be extended to September 30, 2020, a one-month extension from the previous end-date of August 31. Those impacted by this relief include people who are at risk for becoming a resident for tax purposes. Normally if someone is in Canada for 183 days or more in a tax year is considered a Canadian resident for tax purposes. The relief provided by the CRA means that people who have had to remain in Canada due to COVID-19 but are normally a resident of another country will not have to count the period from March 16 through to September 30 towards that total. Additional measures related to travel restrictions, including extensions for cross-border employment income, carrying on business in Canada, waiver requests, disposition of taxable Canadian property by non-residents of Canada, and non-resident employer certification can all be read on the CRA’s website.

Extension of Assessment Time Limits

In an announcement made in late September, the CRA stated is has been given a temporary authority to extend certain deadlines that fall under the Income Tax Act and Excise Tax Act. The extension period is for a maximum of six months and can begin as early as March 13, 2020, and end no later than December 31, 2020. This includes an extension to income tax compliance audits as well as GST/HST compliance audits that would otherwise be statute-barred due to limitation periods. It’s worthwhile noting that reporting periods and taxation years which became statute-barred on or before May 19, 2020, are not covered under the order.

Those who wish to file a notice of objection to an assessment received an extension earlier in the year, and the standard deadline for filing is still in place, being one year after the tax filing deadline for the return, or 90 days from the date of the notice of assessment or determination. The CRA has stated that “taxpayers and registrants whose deadline to request an extension of time to file a Notice of Objection to an assessment or reassessment expires after December 20, 2020, will not receive an extension of time to male their request.

Wage Subsidy is Extended

Some employers may be able to benefit from an extension to the Canada Emergency Wage Subsidy. The Canadian government made mention of an extension to the CEWS during its speech from the throne earlier this month. While the announcement was light on details, it did say that it will extend the period through to the end of next summer. The CEWS is aimed at helping businesses keep staff employed throughout a drop in revenue, offering to cover 75% of wages up to a weekly maximum of $847. We previously reported on the government’s announcement to expand the number of businesses that could qualify for CEWS as well as an initial extension. The details around those announcements can be found here.

Contact Feigenbaum Law if you are looking for a custom solution to your personal tax planning needs. Our lawyers and financial professionals have unparalleled knowledge of tax law both in the United States and Canada. We understand that every tax situation brings with it unique challenges. Our experience makes us uniquely qualified to address these challenges. We offer services to clients in the US, Canada and around the world. Contact us to learn more about how we can help or call us at (905) 695-1269 or toll-free at (877) 275-4792.