4053893 Canada – Federal Court finds that a disclosure by a company was reasonably treated by CRA as not voluntary given enforcement action against its sole shareholder
An individual was contacted by CRA by letter and in a phone call about his failure to file returns for 10 years, his company (which also had not filed returns for 20 years) then made a voluntary disclosure (VDP) application, following which the individual filed his delinquent returns. McHaffie J found that it was reasonable for CRA to determine that the company’s disclosure was not voluntary given the close connection between that disclosure and the enforcement action being taken against the individual, including that his returns would disclose his income from the company, and in the telephone conversation with CRA, it had been informed that the company was still active.
The company had been successful at 2019 FC 51 on the basis of a failure in the Minister’s decision to address how the enforcement action against the individual would likely have uncovered the disclosed corporate information, but his time around the reasons of the Minister’s delegate, although brief, were adequate, and McHaffie J found the decision to deny admission to the VDP to be reasonable.
Neal Armstrong. Summary of 4053893 Canada Inc. v. Canada (National Revenue) 2021 FC 218 under s. 220(3.1).