I have helped hundreds of people successfully navigate from the US to Canada. If you're thinking of moving or retiring to Canada contact me today to chat about your plans.
I can be reached via email at firstname.lastname@example.org, by phone at 250-661-9417 or through my contact page here.
I look forward to speaking to you soon.
Phil Hogan, CPA, CA, CPA (CO)
Cross-Border Tax and Investment Specialist
I started a contracting company in 2012 and incorporated in 2013. The company has become relatively successful however I’ve neglected to file tax returns for each year. I want to ensure I don’t get in any more trouble with the tax department and I would like to catch up on my personal and corporate tax returns.
I almost have all my bookkeeping finished for those years an I’ll need help in filing. Can you please let me know what the process is for catching up on late returns. I’m willing to pay any penalties that arise, but it would be nice to avoid any unnecessary taxes or penalties if possible.
Thanks for the email and I’m sure I’ll be able to help. Luckily CRA (Canada Revenue Agency) has a program available that will allow you to get caught up on your tax returns without fear of being assessed related penalties. You will however have to be eligible for entering and filing under the program.
In general terms you’ll need to meet the following criteria to be eligible for the CRA voluntary disclosure program:
- At least one of the tax returns or information returns needs to be at least 1 year overdue – yes
- There needs to be the potential for penalty on the returns in question – yes
- The disclosure needs to be complete – will need to ensure this is met
- In most cases you can only use the VDP program once – will need to confirm that you haven’t used the program in the past
- You won’t be eligible for the program if CRA has already has asked you for returns – we’ll need to discuss this one.
If you meet the criteria above we’ll be able to prepare your late corporate and personal tax returns for submission under the program. As this will take some time we should also file a no-named voluntary disclosure to ensure we can “start the clock” on your submission. This will help mitigate the risk that CRA asks for your returns before the returns are ready to be sent in.
Once the no-named VDP and subsequent submission is received by CRA you’ll likely need to wait a few months before you receive a response. However, as long as the criteria above is met you’re chances of a successful (penalty free) submission is high. Note that in some cases CRA will abate some of the interest charges, but often you’ll have to pay some interest in the amounts outstanding.
I hope that helps clarify your options for submitting your late tax returns. Please give me a call at 250-381-2400 and we can discuss the process and cost of filing in more detail.
I’m in the same boat, however I’m self employed and not yet incorporated. If I’m expected to get refunds should I bother with the voluntary relief program?
Yes, if you are not subject to penalties because you expect to get refunds you won’t be eligible for the VDP program. That being said it would be odd that you would be receiving refunds if you haven’t paid in any tax installments or remittances. Please give me a call at 250-381-2400 and I’ll do my best to help.