Subsection 271(1)
Administrative Policy
3 February 2021 Transfer Pricing Webinar of the Canadian Tax Foundation: Panel I: Transfer Pricing Audits and Competent Authority
Canada uses CbC data only for risk assessment (including, sometimes, at the field audit level)
- CRA uses various risk-assessment systems, tools, and algorithms to help it to identify the highest-risk entities, and the CbC information is used at that high-risk level nationally. The information can also be used again for the more detailed field risk-assessment in audits when auditors are preparing their audit plans, but field-use of CbC information is usually restricted, and the International Tax Division provides guidance to ensure that it is used properly.
3 December 2019 CTF Roundtable Q. 11, 2019-0824511C6 - Common Reporting Standards
How is CRA using the CRS information obtained by it?
CRA noted that Canada so far has activated CRS exchange relationships with 90 jurisdictions for incoming CRS data and 64 for outgoing CRS data. The CRS provides information on Canadian overseas financial accounts, and this information is helpful to identify offshore financial accounts held by Canadian residents. CRS information is being incorporated in CRA’s system and made available to those involved in the spectrum of compliance and collection efforts.
Operationally, CRS information complements CRA’s existing risk assessment process.
Articles
Robert E. Ward, "The Common Reporting Standard Comes to Canada", Tax Management International Journal, Vol. 46, No. 9, 8 September 2017, p. 538
Concerns re information reported to country authority (p. 540)
...FATCA reporting is largely a tax problem for U.S. persons. In contrast, the concerns raised by CRS reporting are broader. While CRS is an exchange of information between tax authorities, it is this author's experience in assisting clients to establish trusts in the United States so as to avoid CRS reporting that the motivation of these individuals is the privacy and protection of their families who are resident in the home countries to which CRS reporting will be provided. For countries whose controls on disclosure of financial information are easily subverted, CRS reporting is particularly problematic. Disclosures regarding the foreign assets of these individuals invite extortion, and in some cases kidnapping. Where these concerns are not present, often political risk is.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 270 - Subsection 270(1) - Reportable Jurisdiction Person | 159 |
Subsection 271(4)
Administrative Policy
27 February 2024 CTF Transfer Pricing Roundtable
Country-by-country (CbC) reporting
The CbC information is being shared with auditors in the field and is being used in CRA’s risk assessment system. When filing a CbC report, “no TIN” (taxpayer identification number) is to be used only when the constituent entity does not have a TIN, and use in any other circumstances may result in penalties and requirement to refile the report.