Auto-fill coming to CRA just in time for 2015 taxes
While tax season may still be a few weeks away, in preparation for the annual ritual, the Canada Revenue Agency recently unveiled its new “Auto-fill my return” service to make filing your 2015 taxes online easier and faster than ever before.
If you regularly surf the net, you’re probably already familiar with auto- fill software, which is found in most web browsers and can save you time by automatically filling out various fields of webbased forms for you, such as your home and email address, full name and phone number.
According to the CRA, the new auto- fill service “represents the first major step toward allowing Canadians to automatically fill in their income tax and benefit returns.”
The secure service officially launches on Feb. 15 and allows Canadians to automatically complete certain parts of their tax return when they file online using certified tax preparation software that includes the service. The auto-fill program draws from information the CRA already has on file related to T3, T4 and T5 slips, RRSPs, amounts owing under the Home Buyers’ and Lifelong Learning Plans, non- capital losses carried forward from prior years, capital gains and losses in other years, federal and provincial tuition, education and textbook carry-over amounts, instalment payments and more.
The program can be used by anyone who is registered for the CRA’s online service, “My Account” (cra.gc.ca/myaccount) and who uses compatible certified tax preparation software.
Howard Zerker is a partner at the Toronto accounting firm Crowe Soberman LLP whose practice includes the filing of hundreds of personal tax returns annually. He explains that the new auto- fill program is actually an expansion of an existing process that professional tax prepar- ers already use when preparing their clients’ returns, which is to download limited information directly from the CRA. The ability to get additional info online “will be helpful in many cases, where the information is accurate.”
It’s the accuracy issue that worries Zerker, not just with the new auto- fill feature, but with the CRA’s existing “matching program,” in which the CRA takes electronic information received from the various T-slips and tries to match it up, by social insurance number, with the income reported on taxpayers’ T1 personal income tax returns.
Zerker says problems with the matching program can occur when one spouse’s SIN appears on the T- slip for a joint account and the income is split on two spouses’ returns, or where a parent’s SIN appears on a child’s “in-trust account,” but the CRA is looking for the income on the parent’s return.
In the past, when the CRA first implemented this matching program, “they had the common sense (and the resources) to pick up a phone and call the taxpayer or their representative … and inquire about the discrepancies,” Zerker says. “Today the system has changed. If (the) CRA is unable to match the income exactly they simply issue a notice of reassessment and put the onus on the tax- payer … to fight it and prove that they are correct.”
Zerker calls the problem “systemic” and a “tax grab,” suspecting that often the reassessments are simply paid by the taxpayer who doesn’t bother fighting it. Last week, Zerker wrote to the CRA Ombudsman to look into this practice and to encourage the CRA to put policies and procedures in place to reduce the number of incorrect notices of reassessments.