Written on behalf of Feigenbaum Consulting
Parts of Canada are slowly starting to return to normal. While much of the country is still grappling with the impact of COVID-19, courts and businesses have started to re-open. Similarly, the Canada Revenue Agency, which had largely ceased activities related to collections, audits, and appeals, has started to resume operations. This week we’d like to provide our readers with a summary of what activities have resumed and which are still on hold.
Collections on New Debts
Collections activities on new debts are still suspended until further notice. The CRA has stated that flexible payment arrangements will be available to individuals facing collections. The CRA continues to note that payment arrangements are available to people who are unable to pay taxes, make up for child and family benefit overpayments (or other government overpayments), or student loans can apply for payment arrangements. While the debt management call center service is currently closed, collections officers may be reached at 1-800-675-6184.
The CRA has announced that it is resuming “a full range of audit work.” The agency is prioritizing actions that “are beneficial to the taxpayer or where taxpayers have indicated there is an urgency to advancing their audit.” Audits involving large amounts of money are being prioritized, as well as those close to completion or with a strategic importance to the Government of Canada, provinces, territories, and tax partners.
The CRA has stated that there may be changes with respect to the way people interact with the agency, such as providing information via email rather than traditional mail. This is in line with many government agencies embracing technology to reduce time delays and physical contact when dealing with the public.
Objections, Appeals, and Taxpayer Relief
The CRA has stated that “objections related to Canadians’ entitlement to benefits and credits have been identified as a critical service and will continue to be delivered during COVID-19.” People should not expect any delays with the processing of these objections.
That said, objections related to other tax matters filed by individuals and businesses are being held in abeyance, and no collection efforts will be taken with respect to these accounts at the present time.
It’s also important to note that taxpayers who are unable to file a tax return or make a payment by a deadline due to COVID-19 can request a cancellation of penalty and interest on their account. These requests will be reviewed once business operations return to normal at the CRA. While the deadline to file personal tax returns was extended to June 1, or June 15 for those who are self-employed, the CRA has said that penalties for late filing will be waived so long as a person files and pays any taxes owing by September 1st of this year.
No Action Required for T1 Validation and Review Activities
People who received requests for supporting information in relation to amounts claimed on their individual tax and benefit returns do not have to take any action at this time, even if the requests have deadlines. That said, the CRA has stated that although reviews have been postponed, this does not mean that further actions or reviews will not occur in the future.
We will be sure to update our readers with any developments related to the CRA. More information about taxes in Canada during COVID-19 can be found on the CRA’s website.
At Feigenbaum Law, we offer our clients custom solutions to their personal tax planning needs. Our lawyers and financial professionals have unparalleled knowledge of tax law both in the United States and Canada. Contact us about making your transition across the border as smooth as possible. 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.