When you make a mistake on your (already filed) tax return
May 24, 2023
The vast majority of Canadians view completing and filing their annual tax return as an unwelcome chore, and generally breathe a sigh of relief when it’s done for another year. When things go entirely as planned and hoped, the taxpayer will have prepared a return that is complete and correct, and filed it on time, and the Canada Revenue Agency (CRA) will issue a Notice of Assessment indicating that the return is “assessed as filed”, meaning that the CRA agrees with the information filed and tax result obtained by the taxpayer. While that’s the outcome everyone is hoping for, it’s a result which can be derailed in any number of ways.
Over 94% of the returns which had been filed for the 2022 tax year by mid-April 2023 were filed through online filing methods (NETFILE or EFILE), meaning that they were prepared using tax return preparation software. The use of such software significantly reduces the chance of making a clerical or arithmetic error, like entering an amount on the wrong line or adding a column of figures incorrectly. However, no matter how good the software is, it can work only with the information that is provided to it. Sometimes taxpayers prepare and file a return, only to later receive a tax information slip that should have been included on that return. It’s also easy to make an inputting error when transposing figures from an information slip (for example, a T4 slip from one’s employer) into the software, such that $73,246 in income becomes $72,346. Whatever the cause, where the figures input are incorrect or information is missing, those errors or omissions will be reflected in the final (incorrect) result produced by the software.
In other cases, a receipt for something like a charitable donation may be overlooked when the taxpayer is completing the return, or may be received after the return has already been filed. Whatever the cause or reason for the error or omission in an already filed return, the question which immediately arises is how to make things right. And, no matter what the reason for the error or omission, the course of action to be followed by the taxpayer is the same.
For more information on Notice of Assessment see https://www.expert-fiscaliste.org/individual-tax/notice-of-assessment/
When and how to dispute your Notice of Assessment
May 24, 2023
Of the 17 million individual income tax returns for the 2022 tax year filed with the Canada Revenue Agency (CRA) by the middle of April 2023, no two were identical. Each return contained its own particular combination of types and amounts of income reported and deductions and credits claimed. There is, however, one thing which every one of those returns has in common: For each and every one, the CRA will review the return filed, determine whether it is in agreement with the information contained therein, and, finally, issue a Notice of Assessment (NOA) to the taxpayer summarizing the Agency’s conclusions with respect to the taxpayer’s tax situation for the 2022 tax year.
When all goes as it should, the information contained in the NOA is the same as that provided by the taxpayer in his or her return. In a minority of cases, however, the information presented in the NOA will differ from that provided by the taxpayer in his or her return. Where that difference means an unanticipated refund, or a refund larger than the one expected, it’s a good day for the taxpayer. In some cases, however, the NOA will inform the taxpayer that additional amounts are owed to the CRA. When that happens, the taxpayer has to figure out why, and to decide whether or not to dispute the CRA’s conclusions.
For more information on Notice of Assessment see https://www.expert-fiscaliste.org/individual-tax/notice-of-assessment/
Making a payment arrangement with the Canada Revenue Agency
May 20, 2023
All Canadian individual taxpayers were required to pay any tax balance owed for the 2022 tax year on or before May 1, 2023. As of May 2, 2023, interest at a rate of 9% is levied on all such outstanding amounts, and such interest charges are compounded daily.
Where an individual cannot pay 2022 taxes owed, in whole or in part, it is possible to reach a payment arrangement with the Canada Revenue Agency (CRA) which allows the taxpayer to pay outstanding amounts over time.
Information on the kinds of arrangements which are available, and how to contact the CRA to make such arrangements, can be found on the Agency’s website at https://www.canada.ca/en/revenue-agency/services/payments-cra/individual-payments/unable-pay.html and https://www.canada.ca/en/revenue-agency/services/payments-cra/payment-arrangements.html.
CRA issues updated publication on taxpayer objection and appeal rights
May 12, 2023
Most Canadians were required to file an income tax return for the 2022 tax year by the end of April 2023. For each such filing, a Notice of Assessment is issued by the Canada Revenue Agency (CRA), outlining the Agency’s conclusions with respect to the individual’s tax situation (and tax liability) for the year.
Where the information on the Notice of Assessment differs from that which was provided by the taxpayer on the return (and particularly where those differences result in increased tax payable by the taxpayer), that taxpayer must decide whether to object to the CRA’s conclusions as outlined in the Notice of Assessment.
The CRA recently updated and re-issued its publication outlining the circumstances in which a taxpayer can file an objection to the Notice of Assessment and how to do so. The updated publication – Resolving Your Dispute – Objection Rights under the Income Tax Act 2022 (P148 (E) Rev. 22) can be found on the CRA website at https://www.canada.ca/content/dam/cra-arc/formspubs/pub/p148/p148-22e.pdf.
About Expert Fiscaliste
Expert Fiscaliste provides income tax preparation and consulting services to individuals, businesses, with real estate residential operations in Quebec.
If you want to take advantage of our services for your Tax Returns Give us a call at 514-954-9031, or visit our Contact Tax Experts page.
