Taxpayer Relief
With the devastation many people are dealing with in Turkey and Syria, families of those affected here in Canada may be in a position where they are not able to file their taxes on time or afford to pay their taxes owing by the deadline.
Normally, this would result in penalties from the CRA, with interest charged daily. But luckily, there are some situations where you may be eligible for taxpayer relief provisions (TRP).
WHAT IS TAXPAYER RELIEF
In Canada, there are many rules that apply to taxpayers, and the result of failing to follow these rules is often steep penalties. The CRA has implemented these penalties in an attempt to get people to pay their taxes on time.
If you don’t pay your taxes owed in time, you will be subject to paying daily interest on the outstanding amount. Depending on how much you owe in taxes, this can add up to a very hefty bill.
However, the CRA has the ability to waive these penalties when certain extraordinary circumstances apply. This is called Taxpayer Relief and can include the CRA waiving interest, allowing late payments, or possibly reducing the amount of tax you owe.
WHAT SITUATIONS ARE ELIGIBLE FOR TAXPAYER RELIEF
As mentioned, under certain, extraordinary circumstances, the CRA may consider granting relief to a taxpayer who can’t meet their tax obligations.
These circumstances are narrow and are viewed on an individual basis by the CRA. Under all circumstances, you have to prove severe financial hardship. These circumstances can include:
Natural (or man-made) disasters
Serious accidents, illness, death or emotional/mental distress
Civil disruptions, like postal strikes
When an issue caused by the CRA has prevented the taxpayer from meeting their tax obligation
Severe financial hardship
If you are considering filing for this taxpayer relief, you must provide robust proof supporting your claim.
HOW TO APPLY FOR THE TAXPAYER RELIEF PROVISION
As with most cases, dealing with the CRA can be incredibly confusing and frustrating. The process is usually not straightforward, and often cases take quite some time to be resolved. In order to apply for the TRP, you must complete and submit an RC4288 form along with a very detailed letter supporting your claim. Alternatively, the TRP can be submitted online via your CRA online portal.
This letter should include what extraordinary circumstances have brought you to seek relief, and you may need to provide supporting documentation as well. You must also include the steps you are taking to correct the issue.
CONCLUSION
If the earthquake in Turkey and Syria has impacted you or a family member and thereby affected your ability to meet your tax obligations, you may be eligible to apply for Taxpayer Relief.
I suggest consulting with your accountant to ensure your application and supporting documents have been submitted correctly. They can also assist in helping you to navigate the entire process with the CRA.
For more information on the Taxpayer Relief, feel free to contact me at marioyu2@gmail.com or 416-566-8806.
