Well done, you have (hopefully) filed your tax return for 2016.
But before you forget about income tax until early next year, please remember these two important points:
Firstly, the Canada Revenue Agency has wide powers to make sure we Canadians do the right thing under our self-reporting system.
But the Taxpayer Bill of Rights Guide - cra-arc.gc.ca/rights/ (or from 1-800-959-8281) - lists 16 rights we taxpayers have, and what to do if we feel the CRA hasn’t respected those rights.
This Bill of Rights confirms my approach: “The right to receive entitlements and to pay no more and no less (income tax) than what is required by law.
Of course, the CRA can sometimes challenge the deductions and credits you have claimed, which is generally when your rights become particularly important.
Some of the key rights:
“You have the right to be treated professionally, courteously and fairly,” says the CRA.
“Integrity, professionalism, respect and co-operation are our core values.
“You can also expect us to listen to you and to take your circumstances into account, which is part of the process of making impartial decisions according to the law.”
As I mentioned in a recent column, “You have the right to relief from penalties and interest under tax legislation because of extraordinary circumstances.”
Those circumstances include natural disasters, financial hardship or incorrect information provided by the CRA.
If you are unhappy with either the experience or the outcome:
“You have the right to lodge a service complaint or request a formal review without fear of reprisal.”
Note that interest charges on tax owed will continue to accrue until the issue is finally settled.
Secondly, if you ever forget (honestly or otherwise) to declare the correct amount of income, the CRA’s Voluntary Disclosures Program may allow you to escape penalties and prosecution.
You must start the process before the CRA starts to take any action against you.
You must also include all the relevant information.
Ask the CRA office for Form RC199 Voluntary Disclosures Program or go to cra-arc.gc.ca/E/pbg/tf/rc199/README.html
Mike Grenby is a columnist and independent personal financial advisor; he’ll answer questions in this column as space allows but cannot reply personally - email [email protected]
