The CRA May Grant Relief from Interest and Penalties

Taxpayers (both individuals and corporations) facing large amounts of interest and penalties from the Canada Revenue Agency (“CRA”) do have a final avenue of potential relief. Taxpayers are largely unaware of the Taxpayer Relief Program where the CRA has the discretion to grant relief from the interest and penalties. The CRA will do so in cases of extraordinary circumstance (i.e. illness, divorce etc.), actions of the CRA (i.e. long delays in closing an appeal) and an inability to pay or financial hardship. These categories are broad and are not necessarily exhaustive.

While the CRA has the discretion to grant relief from interest and penalties, the Federal Courts have stated that they must use their discretionary reasonably. The Courts have stated that the CRA’s decision must “fall within a range of possible, acceptable outcomes which are defensible in respect of the facts.” While this is not a high bar, it still forces the CRA to act reasonably. In our experience the CRA is fairly reasonable in granting at least partial relief if the situation warrants relief. As well, due to our experience with these applications, we can make them extremely cost effective for our clients.

If your CRA debt is incurring large interest or if you (or your corporation) have been assessed large penalties then we can help. Please contact Adam at aserota@taxperts.on.ca or at 416-493-0444 for a free consultation.