June 26, 2020: Federal Tax Response to COVID-19

Canada Revenue Agency’s National Business Resumption Plan

The Canada Revenue Agency (CRA) recently released its National Business Resumption Plan (NBRP). The plan was created to provide CRA employees with information regarding the staging of the resumption of program and corporate activities and operations that did not resume during the Agency’s critical services phase from March 16 to June 26, 2020.

Agency employees will continue to focus on payments and compliance under the new emergency measures. Other tax activities not yet activated at full strength will be resumed in stages over the next six to nine months.

In this tax alert we highlight when we can expect key CRA activities to resume:

Appeals

July / August 2020

• Re-engagement of all remaining functions in the Objections Program, the Taxpayer Relief Program and CPP/EI Appeals commenced by the Minister and the courts

Assessment, Benefits and Services

July / August 2020

• All remaining services to be resumed other than:
• Discounter audit activities
• T183 (Information Return for Electronic Filing of an Individual's Income Tax and Benefit Return) monitoring activities
• Certain validation activities

Collections and Verification

July / August 2020

• Reactivate Debt Management call centres to address incoming calls from taxpayers; payment arrangement parameters have been expanded to allow taxpayers longer time and more flexibility in resolving debt

• Processing of insolvency filings and issuing Proofs of Claim to trustees; officers will virtually attend creditor meetings for the re-assessment of proposal payments

September 2020

• Debt Management call centres to initiate calls to debtors to pursue payment arrangements
• Collection officers to reconnect with debtors to re-evaluate their financial situation
• Expansion of assistance to vulnerable taxpayers in meeting compliance obligations
• Focus on deliberate non-compliant population working in the underground economy, including raising arbitrary assessments for targeted populations
• T1 processing review programs (pre/post matching) to resume including strategies to educate taxpayers
• Part XIII Non-Resident Withholding activities to resume
• Automated Dialing and Announcing Device campaigns to remind employers of upcoming filing requirements
• GST/HST Delinquent Filer program's automated compliance process with mailouts, automated assessments, and the holding of refunds for non-compliant registrants to be fully re-instated
• Business compliance reviews
• Resume additional employer compliance work to support employees

October 2020

• Individual compliance (non-filer automated mailouts)
• Automated collections letters to be reactivated

January 2021

• Traditional approach to collections (legal warnings; legal action) where payment arrangements not negotiated; some activity may be accelerated to September where compliance risks exist

COVID-19 Program Compliance

July / August 2020

• Pilot of the Canada Emergency Wage Subsidy (CEWS) post-payment compliance project

September 2020

• Additional post-payment validation of new programs introduced as a result of COVID-19 (i.e. Canada Emergency Response Benefit, CEWS and the Canada Emergency Student Benefit)

Compliance Programs

July / August 2020

• High Net Worth Compliance programs, GST/HST Refund Integrity program and GST/HST Large Business compliance programs

September 2020

• Small and medium income tax and GST/HST programs (letter writing/nudge campaigns and social media)

October 2020

• Medium Business Audits Program, Complex Transactions Program, Non-Resident Audit Program (income tax) and Medium GST/HST Audits (with the exception of audits in the municipalities, universities, schools and hospitals sector)

• Small business audits (income tax and GST/HST)
• Desk audits (GST/HST) for business with gross revenue greater than $500,000 (income tax) and $250,000 (GST/HST)

Charities

July / August 2020

• Voluntary revocations, no change audits, high risk audits, and support appeals objection decisions

• Charities (all activities except audits unless audit is requested or almost statute barred)

• Charities, Excise and Registered Plans Directorate audits

Other

September 2020

• CPP/EI rulings to resume​

January 2021

• All remaining Small and Medium Enterprises Directorate and GST/HST programs

The CRA noted that as they progress through phases of the pandemic, business resumption priorities and associated strategies will be reviewed and adjusted accordingly.

This situation is dynamic and government programs can change. To stay up to date and receive insights from our team, visit our COVID-19 Business Advice Centre at MNP.ca/COVID-19. We’re dedicated to supporting Canada’s business leaders by providing timely information and practical solutions for navigating through the uncertainty of COVID-19.