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Interest rates increasing your debt faster than you can pay? Assessed unfair penalties? For many people, it is the onerous penalty and interest charges applied by the Canada Revenue Agency that cause problems. Under certain circumstances, I can prepare a Taxpayer Relief Application to cancel some or all of your penalty and interest charges.
Within the Income Tax Act, the Minister of National Revenue was granted discretion by the Federal Parliament to waive or cancel penalties and interest charges in the last 10 taxation years. This discretion allows the Canada Revenue Agency (CRA) to respond to exceptional situations with compassion and common sense by removing harsh financial penalties when there is no rational basis to impose them.
The applicable CRA guidelines focus on awarding relief where penalties and interest charges arise from circumstances beyond a taxpayer’s control. For example, a natural or human-made disaster that destroyed your records and prevented you from filing you tax return on time would be a typical circumstance where penalty relief could be awarded. Errors by the CRA, such as inaccurate advice or publications, processing delays or errors that prevented you from filing or making payments on time would also be grounds for an application for relief.
In addition, the CRA will consider cancelling penalties and interest when a taxpayer has suffered a serious illness or accident or is under serious emotional or mental distress. If the situation is serious enough to prevent you from making payments or filing your tax returns then the CRA may consider granting relief from penalties and interest arising because of your misfortune. In exceptional circumstances, the CRA may consider canceling penalty or interest charges if you are a position of financial hardship. With the high interest rates charged by the CRA on unpaid taxes, it is not uncommon for taxpayers to fall into a position where their monthly payments towards their tax debts do not even cover the interest charged each month.
A Taxpayer Relief Application is a formal submission requesting the cancellation of interest charges due to one of the factors outlined above. It is also possible to apply for relief as part of a payment arrangement when you know you need an extended period of time to pay your debt and want the CRA to consider waiving future interest charges while you make payments.
As part of my fixed fee program, I can prepare and file an application for Taxpayer Relief on your behalf for only $1,750 plus HST.
I specialize in crafting powerful Relief Applications that explain the reasons the penalty or interest charges are unfounded and argue that your situation is such that you are eligible for cancellation of these unnecessary charges. If you cannot reduce your debt because of high interest rates, I can help to present your financial information to the CRA in such a way that it is clear that the interest charged should be reduced. As unsuccessful relief applications can progress to Judicial Review by the Federal Court, I can utilize similar situations raised by other taxpayers through caselaw to strengthen your relief application and ensure that the CRA consider all relevant factors in deciding whether to grant you relief.
Please be aware that in order to make a Taxpayer Relief Application to the CRA, you must first be tax compliant and have received your Notices of Assessment for all relevant years and on all related accounts. Taxpayer Relief Applications are not meant to be used as a way to arbitrarily settle your debt and the CRA will consider your previous tax compliance in assessing your application and whether you have taken reasonable care in your tax matters. They will also look at whether you have knowingly allowed an outstanding tax balance to exist and if you have made regular payments towards your debt which can greatly affect whether they exercise their discretion in your favour.
If you think you may be eligible for Taxpayer Relief, contact me today.