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NS Kehal Temporary Administrative Measures During Tax Filing
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Since March 18 2020 The Government of Canada announced a set of tax and economic measures as part of the COVID-19 Economic Response Strategy (the " Response Plan") to aid the Canadian economy during the COVID-19 pandemic. The plan is designed to aid in stabilizing the Canadian economy, and it includes measures that will help businesses and individuals with direct transfer, tax deferrals and other measures to ensure that businesses are able to continue accessing credit.

In light of the global disease caused by COVID-19 Due to the global pandemic caused by COVID-19, The Canada Revenue Agency (CRA) has introduced temporary administrative measures to ease some of the problems Canadians encountered when trying to submit their income taxes return(s). In March of 2020 the CRA declared that electronic signatures will be allowed for the tax forms T183 information return for electronic filing of the Individual's income tax and benefit returns and the T183CORP Information Returns for Corporate filing electronically that meet certain requirements, will be accepted as meeting the conditions under the Income Tax Act.

Although there is no indication that CRA is still in the process of pursuing introduction of electronic signatures on T183 and the T183 as well as the T183CORP in a long-term option however the necessary regulatory changes for the permanent implementation of this change are not in place before the beginning of the tax season. In addition, according to CRA messages of march 18, 2020 and August 25 in 2020 as well as August 25, 2020, the CRA will extend the temporary administrative measures that are currently in place to permit electronic signatures on the tax forms T183 and T183CORP as described below in the 2021 tax filing season.

To allow the CRA to continue accepting an electronic signature from an individual whose identity confirmed by an electronic filer the signature on the electronic filer is required to be submitted using one of the below ways:

It could be made available by the taxpayer who files the return with information, and includes the electronic signature, using the latest electronic address given by the taxpayer the electronic filer

It could be given in the person of the taxpayer with the assistance of an electronically filed (e.g. by using a stylus or finger on tablets) or

It could be made available via an access-controlled secure electronic location for example, a secure site that is accessible to taxpayers only because the address of the secure site is known to the taxpayer, and access has been authorized to the filer electronically.

In February 2020 the CRA conducted an online consultation soliciting input by Canadians on a proposed change which would allow electronic signatures on the T183 as well as the T183CORP . The Consultation Summary Report is available on this page. This is where the CRA continues to offer regular updates.

CRA Audits

The CRA has also focused its audit efforts on addressing non-compliance with property transactions specifically on Toronto and Vancouver. Vancouver and Toronto markets, by enhancing their tools as well as methods for getting more precise and valuable information that will help to fight tax avoidance. In the last several times, CRA audits have identified significant tax evasions in the real estate market and have imposed penalties for the related tax. Particularly targeted areas include property flipping, pre-construction sales rent income produced by the estate sharing economy, not reported GST/HST for the sale of the construction of a new or significantly renovated property, capital gains not reported and unreported worldwide income. The budget of 2019 included the addition of CAD 50 millions over five years for the creation of four commercial and residential team for real estate inspections for high-risk areas. These teams will be able to ensure that the tax laws pertaining to real estate are observed.

Disclosure rules that are mandatory

To make it easier for the timely reception of the CRA of relevant information about arrangements which involve tax planning strategies that are aggressive The budget for 2021 proposes to improve Canada's compulsory disclosure rules. These include:

  • Amending rules under the income tax act's rules for reportable transactions
  • The new requirements require the reporting of "notifiable transactions" and specific corporations must declare tax treatment that is uncertain
  • The reassessment timeframe can be extended in certain situations or
  • The new penalties for non-compliance are applicable to taxpayers as well as promoters or advisers.

To assist you in providing electronic signatures to your customers, we here at N.S Kehal are launching service to support you in the tax season in 2021. For more details, check out our services for public accountant for filing tax returns.

 



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