As self-employed professionals, the burden of working out your income tax and filing is not a task that many people enjoy. You may get impatient and make errors, or get stressed out about the deadline and not file your return at all. You would not be the first to falter at tax time. It can be a stressful chore even if you do have an accountant to help.
Correct your taxes with Voluntary Disclosures Program
Instead of worrying if, when, or how you’ll be caught in your mistake, take advantage of Canada Revenue Agency’s (CRA) Voluntary Disclosures Program (VDP) that gives taxpayers a chance to correct their mistakes. Whether it’s inaccurate or incomplete information, undisclosed information previously filed, or a tax return that you should have filed, there is a chance to make it right. The program applies to both income and GST that you may owe the government.
Conditions of a Valid Application
Your VDP application must meet the following five conditions to be valid and to qualify for relief. The application must:
- be voluntary;
- be complete;
- involve the application or potential application of a penalty;
- include information that is at least one year past due; and
- include payment of the estimated tax owing.
If you decide to file a VDP application and it is accepted by the CRA, you will be required to pay the taxes owing, plus any applicable interest. However, you will also be eligible for relief from prosecution, and, in some cases, from penalties and some of the interest that you would otherwise be required to pay.
The VDP application form is offered in both a fillable PDF format which you download to your computer or device, or print it and mail in to the CRA, or alternatively, log on to your CRA business account and fill it in online.