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Taxpayer Relief Provisions

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 Filing Your Return -> Taxpayer Relief Provisions

Taxpayer Relief Provisions (Fairness provisions)

Income Tax Act s. 220(3.1)

Canada Revenue Agency (CRA) has the ability to waive penalties and interest, accept late-filed, amended or revoked income tax elections,  and to provide income tax refunds beyond the 3-year period normally allowed (for individuals and testamentary trusts only).  There is a 10-year time limit on these taxpayer relief provisions (previously termed fairness provisions).  This means that to apply for leniency for tax year 2002, the application must be submitted to CRA by December 31, 2012.

The taxpayer relief provisions can apply when a taxpayer has not been able to meet tax obligations due to extraordinary circumstances such as financial hardship, disruptions in service such as a postal strike, an error in a CRA publication, or a disaster such as flood or fire.

To make application under these provisions, taxpayers can complete form RC4288 - Request for Taxpayer Relief, and submit it to their local tax services office.

New:  A June 2011 Federal Court of Appeal decision, Bozzer v Canada, resulted in an outcome which benefited the taxpayer.  As a result, the taxpayer relief provisions can apply to reduce interest and penalties which have accumulated in the 10 taxation years preceding the request for leniency, even if the tax debt causing the interest arose prior to that period.  So, if a tax debt arose from the 1999 tax year, penalties and interest that have accumulated from 2002 to 2011 could still be reduced as a result of a 2012 request for leniency.

CRA Resources

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Taxpayer relief provisions

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Information Circular IC07-1 Taxpayer relief provisions

See also:

Voluntary Disclosures Program (VDP)

 

Revised: May 23, 2014

 

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