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.
Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the Department.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle du ministère.
Principal Issues:
Whether a 162(1) penalty can be applied where a person fails to file T2140 as required by section 189.
Position TAKEN:
Yes.
Reasons FOR POSITION TAKEN:
The intent of the legislation is obviously to apply penalties in such situations. Ss. 189(8) provides for making "such modifications as the circumstances require", and ss. 162(1) can be made to apply simply by modifying the preamble thereof to refer to the person's failure to file "a return ... as and when required by subsection 189(6)".
August 25, 1994
Richard Labelle Rulings Directorate
Assistant Director J.D. Brooks
Audit Section
Charities Division
Attention: J. Shelvock
942175
Penalty for Failure to File under Subsection 189(6)
This is in reply to your memorandum of August 23, 1994 in which you requested our view as to whether a person can be assessed a penalty under subsection 162(1) for failure to file a return as required by section 189 in respect of a non-qualified investment issued by a private foundation.
As you are aware, section 162 is applicable to section 189 "with such modifications as the circumstances require". It is our view that it is appropriate to modify the preamble of subsection 162(1) to read as follows:
"Every person who has failed to file a return for a taxation year as and when required by subsection 189(6) is liable to a penalty equal to the total of"
Thus, a penalty can be assessed under subsection 162(1). Similarly, it is our view that a penalty can be assessed under subsection 162(2) where the failure to file is repeated in a subsequent year.
R. Albert
for Director
Business and General Division
Rulings Directorate
Policy and Legislation Branch
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