6 December 2011 Roundtable, 2011-0427251C6 - 2011 TEI-CRA Liaison Meeting Qu. 3

Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.

Principal Issues: How should taxpayers obtain details underlying a Part XIII tax reassessment?

Position: See Response.

2011 TEI-CRA Liaison Meeting
December 6, 2011

Question 3 - Details of Part XIII Reassessments

Many taxpayers receive Part XIII tax reassessments as a consequence of Part 1 tax adjustments made by CRA's international tax directorate. The documentation CRA issues to the taxpayer, however, lacks detail making the account analysis and reconciliation of Part XIII tax difficult and time consuming. Unlike account statements issued by TSOs where account balances are segregated by taxation year, accounts coded "NR" lump all "non-current" year balances into a single "bucket." Does CRA plan to upgrade its accounting for "NR" accounts in order to mirror the detail provided for accounts coded "RC"? If not, how should taxpayers obtain the details underlying Part XIII reassessments?

CRA Response

As identified in the question, the assessment and reassessment of Non-Resident Part XIII Tax and of corporate Part I Tax are different as they contain different information.

For Part I Tax the assessment of tax on corporate accounts is carried out on a line by line basis (i.e. income, expenses, tax credits, etc.). When a reassessment is carried out on the account, the amounts originally assessed and the adjusted amounts are provided to the client for the specific tax years. For multiple tax year adjustments, multiple statements will be provided. The assessment or reassessment will also include the total amount owing to the Canada Revenue Agency (CRA).

For Non-Resident Part XIII Tax, assessment/ reassessment notices provide a notice containing the tax year for the assessment, the amount of tax previously owing, the amount of the current assessment (tax, penalty, and interest), the income type, and the tax rate. For reassessments, the original notice number of the assessment being reassessed is also included. There may be several tax assessments for the same taxation year as different types of income may be assessed at various rates, depending on the taxpayer's country of residence, however, only one tax year will be included on each assessment/reassessment. The notice will also have the taxpayer's balance owing. This includes the total of any previous balance and the amount of the current assessment.

Although there are no plans to upgrade the accounting for Non-Resident accounts to mirror the detail provided in the corporate accounts, this information is available if requested by the taxpayer.

Should a taxpayer require additional information regarding an assessment or reassessment, they may contact the International Tax Services Office, Non-Resident Withholding Division, by writing to PO Box 9769, Station T, Ottawa, Ontario, K1G 3Y4 or by telephone, toll-free, at 1-800-267-3395 (within Canada and the United States) or at 613-952-2344 from anywhere else. The fax number is 613-941-6905.