The Canada Revenue Agency Post-Pandemic
With Canada’s vaccination rates on the rise, many taxpayers are wondering when the Canada Revenue Agency (“CRA”) will get back to its regular business. Currently, almost all audits were halted before they even started though high risk audits were allowed to continue. CRA collections released all legal action against taxpayers and has not yet restarted going full force in its collections activities. The Tax Court of Canada just reopened its doors and has started setting down hearings beginning in September.
So the question becomes, when will CRA restart their audit program in full, and when will they start collecting the billions in taxes they are owed that remains unpaid?
The Canada Revenue Agency Post-Pandemic
Though there has been no official guidance, it is likely that the CRA beings to resume its normal operations in September. Barring another deadly wave in the pandemic of course. What this will mean is that all audits that were previously scheduled or cancelled will resume. Hundreds of thousands of taxpayers will be subject to new audits, and CRA auditors will be under pressure to achieve results. These upcoming audits will likely be more difficult to deal with since the auditors will have a set result in mind because the CRA sorely lacks funds.
CRA collections will also likely reopen their offices and will begin contacting taxpayers to arrange for payment of their tax debts. They will also start to take legal action to collect the debts. They will seize bank accounts, garnish wages, issue requirements to pay, and potentially lien property or other assets of value. It is imperative to be in contact with CRA collections to ensure that you can get yourself on a payment plan so that your business is not interrupted by their legal action.
The CRA appeals section will also likely reopen in full force. They have been operating at an extremely reduced capacity, but that should change come September. They will also be under pressure to resolve their files quickly knowing that the audit section will be making tough decisions that taxpayers will likely not agree with. So there will be a large amount of objections coming following the resumption of CRA audit activities.
The Tax Court of Canada Post-Pandemic
The Tax Court of Canada has announced that they are scheduling in person hearings in September of 2021. So absent another deadly wave of the pandemic, the Tax Court of Canada should be back to normal operations soon. If you have an ongoing Tax Court of Canada appeal, and were waiting for the resumption to seek assistance, now is the time.
The Voluntary Disclosure Program Post-Pandemic
The Voluntary Disclosure Program has been experiencing delays even before the pandemic started. Their normal processing times have slowed from one year to more than two years. We are hopeful that they will return to their normal operations and will review and make decisions quicker than the current two year timeline. However, it will likely take additional CRA resources in order to achieve something like this.
The positive of the lengthy delay is that taxpayers have more time to pay their estimated amounts owing. The negative is that the taxpayer is essentially in limbo for years. Their financial lives are on the line, and they have no idea what the result will be.
COVID-19 Benefits Post-Pandemic
A major area that the CRA will focus on post-pandemic is auditing COVID-19 benefit programs. The CRA has created groups and task forces specifically to review the pandemic benefits claimed by individuals and corporations, and verify whether they were entitled to those benefits. We can already see this happening with CERB and CRB.
If your audit was put on hold, or you have CRA issues that need assistance once they get back to business, call us today! Rosen Kirshen Tax Law is here to assist everyone who has a CRA problem.
This article provides information of a general nature only. It does not provide legal advice nor can it or should it be relied upon. All tax situations are specific to their facts and will differ from the situations in this article. If you have specific legal questions you should consult a lawyer.