“All files should be checked..”
Generally speaking, the Fairness Rules allow the Canada Revenue Agency discretion to
- cancel or waive penalties and interest;
- accept late filed, amended or revoked income tax elections; and
- for individuals and testamentary trusts, issue income tax refunds and reduce amounts payable beyond the normal 3-year period.
Because of the changes in the Budget, any relief for taxation years between 1985 and 1994 must be submitted before January 1,2005.
Therefore, all tax advisors should review those situations where there may be the possibility that there will be a fairness request, and the request should be made by December 31, 2004. Once this deadline has passed, it will be impossible to request relief for the years 1985 to 1994.
On a go-forward basis, the Fairness Rules will only apply for the previous ten years. For example, in the year 2008, the fairness request can only go back to 1998.
A careful review of all files should be done.
TAX TIP OF THE WEEK is provided as a free service to clients and friends of the Tax Specialist Group member firms. The Tax Specialist Group is a national affiliation of firms who specialize in providing tax consulting services to other professionals, businesses and high net worth individuals on Canadian and international tax matters and tax disputes.
The material provided in Tax Tip of the Week is believed to be accurate and reliable as of the date it is written. Tax laws are complex and are subject to frequent change. Professional advice should always be sought before implementing any tax planning arrangements. Neither the Tax Specialist Group nor any member firm can accept any liability for the tax consequences that may result from acting based on the contents hereof.
