Collections, audit, objections and appeals: CRA and COVID-19

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• Collections
• Audits
• Objections, appeals and taxpayer relief
• Individual (T1) validation and review activities

Collections

Collections activities on new debts will be suspended until further notice, and flexible payment arrangements will be available.

If you can't pay your taxes, child and family benefit overpayments, Canada Student Loans, or other government program overpayments in full, payment arrangements are available.

Collections staff will address pre-existing situations on a case-by-case basis to prevent financial hardship. For further information contact the CRA.

Banks, and employers and other third parties do not need to comply or remit on existing Requirements to pay (RTP) during this time.

General information: When you owe money – collections at the CRA

Audits

The CRA is resuming a full range of audit work and adapting our practices to reflect the health and economic impacts of COVID-19. We are prioritizing actions that are beneficial to the taxpayer or where taxpayers have indicated there is an urgency to advancing their audit. In prioritizing our resumption, we are also focusing on higher dollar audits first, audits close to completion, and those with a strategic importance to the Government of Canada, provinces and territories, or our tax treaty partners. In addition, efforts to combat suspected fraud and other criminal activity are advancing.

New methods of taxpayer and registrant interaction will be required, and the CRA is working to develop procedures and protocols to adapt these to the current reality. For example, we are providing taxpayers with the option to send us information via e-mail. Some key changes will relate to offering additional time and upfront consultation on requests to provide the CRA with information and access. Public Health directives will be respected, and additional reasonable measures will be extended both in terms of timing or another other aspect of a CRA request.

As business operations resume, Requirements for Information (RFIs) are being issued. CRA officials will use judgement and flexibility to accommodate delays in the process due to the COVID-19 situation. Where possible, information should be sent to the CRA electronically through My Account, My Business Account or Represent a Client or via registered mail or courier. Until further notice, face-to-face document exchange should be avoided as much as possible.

In addition, the CRA has started working on the post-payment audit program for the Canada Emergency Wage Subsidy (CEWS). Audits under this program will begin this summer, and they will focus on CEWS applications made for periods one to four. Risk assessment tools and random sampling methodology will be used to select a range of files for this phase of the audit program. The CRA will use results from this phase to identify types and levels of non-compliance with CEWS legislation. These findings will inform future CEWS audit strategies which will be launched in the fall of 2020. It is important to note that the CRA is not looking to punish businesses who have made an honest mistake in their application, but to detect and address instances of deliberate non-compliance.

General information: Business audits

Objections, appeals and taxpayer relief

Updated July 3, 2020

The CRA’s dispute resolution and taxpayer relief programs are resuming operations. We are currently contacting taxpayers who have filed objections, CPP/EI appeals to the Minister, or applied for relief of penalties and interest.

We will strive for flexibility with deadlines to submit supporting documentation, recognizing taxpayers’ unique circumstances. Taxpayers are encouraged to use the CRA’s electronic portals.

Where there are COVID-19 related delays in finalizing resolution of a dispute or request for relief, we will advise you as soon as possible. We appreciate your patience as we address all taxpayers’ requests.

Objections related to Canadians' entitlement to benefits and credits have been identified as a critical service and will continue to be delivered during COVID-19. There should not be any delays with the processing of these objections.

If the deadline for filing an objection under the Income Tax Act or Excise Tax Act was between March 18, 2020 and June 30, 2020, the objection can be filed on or before June 30, 2020, without providing the reasons why it was not filed on time.

For more information about Tax Court of Canada (TCC) business resumption during the COVID-19 pandemic, please refer to the Tax Court of Canada website.

As part of government actions taken in dealing with the effects of the COVID-19 pandemic, tax filing and payment deadlines have been extended. Taxpayers do not need to make a request for the cancellation of penalties and interest if the deadlines are met.

The CRA is also waiving interest on existing tax debts related to individual, corporate, and trust income tax returns from April 1, 2020, to September 30, 2020 and from April 1, 2020, to June 30, 2020, for goods and services tax/harmonized sales tax (GST/HST) returns. While this measure for existing tax debts does not cancel penalties and interest already assessed on a taxpayer’s account prior to this period, it ensures that a taxpayer’s existing tax debt does not continue to grow through interest charges during this difficult time.

The Taxpayer Relief Program will review requests related to COVID-19 on a priority basis.

Taxpayers who are unable to file a return or make a payment by the tax-filing and payment deadlines because of COVID-19 should only request the cancellation of penalty and interest charged to their account. Penalties and interest will not be charged if the new deadlines that the government has announced to tax-filing and payments are met.

General information:

• Service feedback, objections, appeals, disputes, and relief measures
• Taxpayer relief provisions

Individual (T1) validation and review activities

Some review and verification activities were initiated prior to the COVID-19 pandemic and clients may have been contacted to provide supporting information in relation to amounts claimed on their individual tax and benefit returns. For correspondence sent by our validation and verification programs before March 16, 2020, that includes dates for response or provision of documents for validation and verification programs, no action is required.

It is important to note that, although reviews have been postponed in these cases, it does not prevent future actions or reviews from being completed. Taxpayers will need to keep their supporting documents, in case they are selected for review in the future.

Since March 16, 2020, Canada Revenue Agency (CRA) employees have been working under certain restrictions for their health and safety during the COVID-19 pandemic. If you were sent a letter before March 16, 2020, by our programs and would still like to talk to a representative about the review or have questions about the status of your file, our phone lines listed in our correspondence will be available starting July 6, 2020.

Beginning March 16, 2020, the Agency implemented an administrative approach to process some cases in these programs in order to assist taxpayers during this time of crisis. If you have been contacted by these CRA programs on or after March 16, 2020, please follow the instructions provided.

General information: Review of your tax return