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.
SUBJECT: VOLUNTARY TAX PAYMENTS AND CREDIT INTEREST ON REFUND SECTION: 164(3)]
ISSUE SHEET
Question 56 - Voluntary Tax Payments
(1991 Canadian Tax Foundation Roundtable)
Issue
The underlying concerns in the question were:
- (a) whether the Department would recognize voluntary prepayments of taxes for a taxation year under waiver, and
- (b) assuming that no reassessment of additional taxes is made, whether interest would be paid to the taxpayer from the date of the payment until the date the payment is refunded.
Answer
An affirmative answer was given to both concerns.
Discussion
The above concerns were considered and addressed in 1991 at the Deputy Minister level after the issue was raised by the Vancouver District Office. See Vancouver D.O. memo dated January 8, 1991 to Head Office, memo from D.S. Brown, Director General, H.O. Collections to R. Roy, ADM, Taxation Programs Branch dated January 15, 1991 and Deputy Minister's memo to Vancouver D.O. dated February 15, 1991. See also August 14, 1991 memo from Revenue Programs Division to All Taxation Centres.
That interest .. is payable on the prepayment that is refunded to the taxpayer XXX
Mr. Udle further explained that when there is a reassessment, arrears interest is charged on the amount of reassessed taxes until the date of the prepayment. Thenceforth, if the prepayment is less than the amount of reassessed taxes, arrears interest is calculated on the reduced amount of reassessed taxes. If the prepayment exceeds the reassessed taxes, interest is paid to the taxpayer on the excess until it is refunded to the taxpayer.
Prepared by: John Chan
May 28, 1992
5-921240
All rights reserved. Permission is granted to electronically copy and to print in hard copy for internal use only. No part of this information may be reproduced, modified, transmitted or redistributed in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, or stored in a retrieval system for any purpose other than noted above (including sales), without prior written permission of Canada Revenue Agency, Ottawa, Ontario K1A 0L5
© Her Majesty the Queen in Right of Canada, 1992
Tous droits réservés. Il est permis de copier sous forme électronique ou d'imprimer pour un usage interne seulement. Toutefois, il est interdit de reproduire, de modifier, de transmettre ou de redistributer de l'information, sous quelque forme ou par quelque moyen que ce soit, de facon électronique, méchanique, photocopies ou autre, ou par stockage dans des systèmes d'extraction ou pour tout usage autre que ceux susmentionnés (incluant pour fin commerciale), sans l'autorisation écrite préalable de l'Agence du revenu du Canada, Ottawa, Ontario K1A 0L5.
© Sa Majesté la Reine du Chef du Canada, 1992
Email this Content