This process is necessary when you plan to catch up with your back taxes. In cases where a person inadvertently becomes delinquent this program is designed to help. However, there are guidelines. The following requirements are mandatory:
- The disclosure must come on a voluntary basis, e.g. not after a “demand to file” notice
- The information about the delinquent tax must be accurate and older than one year
- The penalties, (fines and interest), are added to the total amount due
If none of these items are met, then the CRA will not accept the voluntary disclosure. In addition, being investigated by the CRA negates any possibility of taking this measure, in other words, it is too late to begin the process. Any attempt to utilized tax records under a year old is seen as an attempt to fraudulently avoid penalties.
The fact that this program exists means that the CRA is willing to help people who, for whatever reason, legitimately fall behind in paying their taxes. Moreover, to avoid having to go through this, it is wise to file every year.