Filings, Assessments and Related Issues

AuthorVern Krishna
ProfessionProfessor of Common Law, University of Ottawa Barrister at Law
A basic feature of the Canadi an income tax system is th at it relies heav-
ily on taxpayers to sel f-assess their income on an annual basis on a pre-
scribed form and in a prescribed manner. Filing requirements depend
on a taxpayer’s status. Thus, voluntary compliance and self-assessment
are the foundation of the administ rative structure of the Act.
The term “voluntary” is a mi snomer. The tax system does not rely
exclusively upon voluntary compliance. It has persua sive inducements
to encourage taxpayers to disclose their income. The minister can im-
pose penalties, make third-party demands, garnish income, seize prop-
erty and prosecute through the cr iminal process. Indeed, as we see in
this chapter, the CRA powers e xceed those of most other government
agencies and are subject to fewer legislative and judicial controls.
1) Who Must File
Not all taxpayers must f‌ile t ax returns every ye ar: f‌iling requirements
vary according to the taxpayer’s status, typ e of income earned and tax
credits claimed. The following, however, must f‌ile income tax return s:1
1 Income Tax Act, RSC 1985, c 1 (5th Supp), [ITA], subs 150(1); Information Circu-
• Corporations (other than registered charities);
• Individuals, if they are taxable in the year;
• Individuals who have ta xable capital gains or have disposed of cap-
ital property in the yea r; and
• Individuals who owe an amount under the Home Buyer’s Plan or
Lifelong Learning Plan.
In addition to income tax return s, some taxpayers must also f‌ile vari-
ous information return s that report income that they pay to other ta x-
2) Filing Deadlines
Taxpayers must f‌ile their return s on prescribed forms. Each retur n is
in respect of a “taxation year”2 in accordance with the following f‌iling
Tax pay er Time L imit Form
Individuals  April of the following
Deceased Persons  months after death*T
Corporations (whether or not year-end t ax
is payable)
 months after f‌iscal
year-en d
Trusts and estates (if tax is payable in
respect of the year)
 days from end of
estate’s or trust’s
taxation year
Registered charities (Info. return s)  months after year-end T 
* This rule appli es for individuals who die b etween  November and the no rmal f‌iling date. Where
an individual die s between  January and  Oc tober, the normal f‌iling date ( Apr il) applies.
For individuals in busine ss, the Act extends the deadline for f‌iling from
30 April to 15 June.3
3) Individuals
An individual must f‌ile an i ncome tax return in respect of a taxation
year if he is tax able in the year.4 An individual may, however, f‌ile a
return even though he is not taxable in a pa rticular year. Voluntary
f‌iling a nil retur n even if there is no tax payable tr iggers the limitation
lar 71-14R3, “The Tax Audit” (18 June 1984).
2 ITA, ibid, s 249.
3 Ibid, para 150(1)(d).
4 Ibid, paras 150(1)(d) and 150(1.1)(b).
Filings, As sessments and Relate d Issues 517
period within which the CRA may assess the individual in respect of
the retur n.5
It is generally prudent for an individual to f‌ile annual tax returns
regardless of whether or not she believes that ta x is payable for the
particular ye ar. Otherwise she may be subject to penalties if it is later
established that she was l iable for tax in respect of that year.6
4) Corporations
A corporation (other than a corporation registered as a ch arity) must
f‌ile an income tax return w ithin six months from the end of its tax ation
yea r.7 The return, accompanied by f‌inanci al statements and supporting
schedules, is due whether or not the corporation is tax able.
5) Trusts and Estates
A trust or estate must f‌ile a retur n in respect of each taxation year for which
taxes are payable within ninety days from the end of its t axation year.8
A trustee in ban kruptcy, liquidator, receiver or agent acting on be-
half of a person who has not f‌iled a retur n must f‌ile a return on behalf
of that person withi n the relevant time limit.9
6) Deceased Persons
The legal representative of a person who has died w ithout f‌iling an in-
come tax return must f‌ile the dece ased’s return within six months from
the day of death,10 if the ta xpayer dies between 1 November and the
normal f‌iling d ate. Where the individual d ies between 1 January and 31
October, the normal f‌iling date applies.
7) Desig nated Persons
The minister has additiona l powers. Where a person who is required
to f‌ile an income tax return fails to do so, the minister may de signate
another person to f‌ile the return w ithin a stipulated time.11
5 Ibid, subs 152(4). The prescribed for m for individuals is Form T1 Gener al. Taxpay-
ers f‌iling si mple tax returns may i n certain circum stances use Form T1 Speci al.
6 Ibid, s 162.
7 Ibid, para 150(1)(a).
8 Ibid, para 150(1)(c).
9 Ibid, subs 150(3).
10 Ibid, par a 150(1)(b).
11 Ibid, par a 150(1)(e).

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