When faced with the possibility of penalties and interest from owing tax there are ways to find a relief. According to the Income Tax Act, the Minister of National Revenue has the authority to cancel or waive part or all of the interest or penalty associated with a back tax claim. That stated, in order to take advantage of this an Ottawa taxpayer must apply within a ten year window for the year in question.
The Voluntary Disclosure program was implemented just for this, by the CRA. The guidelines provide a road map and criteria for a taxpayer to follow that allows them to come forward voluntarily. This gives the Ottawa taxpayer the chance to reconcile any omissions or non-compliance issues that the CRA has identified.
The Minister’s power in permitting relief has its limitation in the year of taxation, ending in the ten year period prior to the year of submission. This holds true for fiscal periods used in partnerships. When an Ottawa taxpayer files correctly, they can have the penalties waived or lowered at the discretion of the Minister thus avoiding prosecution.
One thing to keep in mind, however, is that the voluntary disclosure program is only available for certain situations of non-compliance. According to the Income Tax Act, rollovers, or late filings are exempt. In addition, there is only one chance to use the voluntary disclosure program per individual and business.
When you come to Ottawa Tax Preparation, we can help determine if utilizing the program is the right move when dealing with the requirements with filing back taxes. Prudent actions are what will help when working with the CRA on Back tax issues. Our professional accounts have the expertise and the experience to see things through to a successful finish for both sides of the tax issue.