subject: The Voluntary Disclosure Program – Do You Qualify to Make a Voluntary Disclosure Application? [print this page] The Voluntary Disclosure Program Do You Qualify to Make a Voluntary Disclosure Application?
What does a late tax filer, a taxpayer who donated to a "bogus charity" and a taxpayer with undisclosed offshore income have in common? Well, if the CRA hasn't contacted them yet, they all may be able to file an application under the Voluntary Disclosure Program and avoid penalties.
The Voluntary Disclosure Program was put in place so that taxpayers could come clean about undisclosed income. To be approved under the Voluntary Disclosure Program you must meet four criteria.
1. Disclosure must be voluntary. If the CRA has contacted you to request that you file a return, or has requested information about a return that was already filed, disclosure would not be considered voluntary.
2. The tax year(s) in question must be at least one year old.
3. Disclosure must be complete.
4. The tax debt must involve a penalty.
If you meet all of the criteria, the Voluntary Disclosure application process is as follows:
1. An initial application is submitted to the CRA including all pertinent details that include but are not limited to the tax years in question and amounts of income that was not disclosed.
2. Once the CRA has received your request they should reply within 60-90 days. They will send a letter that will indicate the application number and the VDP officer who will be responsible for the file. You will then have 90 days to amend or file the tax returns for the tax years in question.
3. Once all of your paper work is filed, the VDP officer will review your request and determine if the VDP application will be approved. It is at this time that the CRA will check to see if your application qualifies by determining if disclosure is voluntary, complete, involves a penalty and is at least one year old.
The Voluntary Disclosure Program is an official process that could take as long as six months to complete and should be handled by a professional. Chartered Accountants are seasoned experts in navigating CRA policy and procedure and are the best choice if you are considering making a disclosure to the Canada Revenue Agency under the Voluntary Disclosure Program. They can also prepare the required tax returns or amendments to past tax returns.
There are many benefits to coming clean and disclosing income that you know you earned, under the Voluntary Disclosure Program. These include; avoiding penalties, prosecution and also coming to terms with your tax debt and putting it behind you.
For more information about the voluntary disclosure program please visit http://www.fightbacktoday.ca.
