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It’s tax time: Don’t panic.
2-24-2015
Whether you are completing your income tax and benefit return by yourself or getting help from someone else, the Canada Revenue Agency (CRA) and its community partners are here for you. Even if you have little or no income, you should file your income tax return—you may be eligible for credits and benefits. Filing your return is the key to getting your goods and services tax/harmonized sales tax credit and the Canada child tax benefit, among others.
Many Canadians get the help of someone they trust to complete their tax return. If you also want this individual to take care of your tax affairs, such as file your tax return, check your refund, and access your information on My Account, don’t forget to give them the permission to do so on your behalf by completing and submitting Form T1013, Authorizing or Cancelling a Representative.
Third-Party Civil Penalties
The objective of the third-party civil penalties is to deter third parties from making false statements or omissions in relation to income tax or goods and services tax/harmonized sales tax (GST/HST) matters. These penalties are directed at ensuring tax compliance by deterring behaviour that results in non-compliance.
The Canadian tax system has benefited from a cooperative relationship between professional advisors and Canada's tax administration, the CRA. Since that relationship is critically important to all Canadians, and to the continued health of our taxation system, the CRA is committed to applying the penalties fairly, consistently and only when clearly justified. The CRA recognizes that tax professionals have a responsibility to act in the best interests of their clients, and this includes the right to minimize their tax liability within the law.
Planner Penalty" Amount
The Income Tax Act provides that the penalty to which a person is liable for filing a false statement is $1,000. However, when a false statement is made in the course of a planning activity or a valuation activity, the penalty amount is the greater of $1,000 or the total of the person's gross entitlements for the planning or valuation activity (calculated at the time at which the Notice of Assessment of the penalty is sent to the person).
Preparer Penalty
The "preparer penalty," provides for a penalty on a person who makes, or participates in, assents to, or acquiesces in the making of a statement to, by or on behalf of another person that the person knows, or would reasonably be expected to know but for circumstances amounting to culpable conduct, is a false statement that could be used by or on behalf of the other person for a purpose of the ITA/ETA. Despite the name "preparer penalty," it can apply to any person in the aforementioned situation and is not limited to a tax return preparer. The penalty is applicable to the tax return preparer for each investor or taxpayer that can be identified. Examples would include:
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a person preparing a tax return for a specific taxpayer;
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a person providing tax advice to a specific taxpayer; and
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an appraiser or valuator preparing a report for a specific taxpayer or a number of persons who can be identified
Footnotes: Footnotes: This column is presented as a general source of information only and is not intended as a solicitation for business. It is always recommended that you consult a qualified tax professional beforeembarking on any of the suggestions outlined above. Mohammed Yasin, CGA, is the principal of M. Yasin & Co. Inc., Certified General Accountants and has offices in Vancouver & Surrey,B.C. For more information on this topic or any other taxation matters, please contact taxes@alameen.ca.
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