CRA indicates that it initially imposes instalment interest on VDP-accepted wash transactions “given … system limitations”
Where CRA accepts a voluntary disclosure for a wash transaction, and grants full relief for penalties and interest on the amounts the supplier otherwise should have collected and remitted, instalment interest nonetheless will be applied respecting the periods covered by the voluntary disclosure given CRA’s “system limitations” – although CRA indicated that such interest likely would then be cancelled, and stated:
Internal discussions are currently underway on the processing and policies on the waiving of instalment interest with the Voluntary Disclosures Program.
Neal Armstrong. Summary of 25 March 2021 CBA Commodity Taxes Roundtable, Q.10 under ETA s. 281.1(1).