You can’t legally avoid paying taxes wherever you live. Every country requires its citizens to pay a levy if their income crosses a specified threshold. It’s one of governments’ primary revenue sources. In Canada, about 27.2 million individuals filed their returns in 2019.
However, circumstances may result in some taxpayers occasionally defaulting on their legal obligation. If you make such a mistake and take no steps to correct it, you’ll face penalties and interest charges when caught. You could also be imprisoned, which leads to having a criminal record.
Fortunately, some countries have programs that offer defaulters the opportunity to voluntarily come clean and be exempt from penalties and jail terms.
If you’ve made one or more of the following mistakes, you’re eligible to apply:
You didn’t submit a return, and it’s now overdue
You received income that you didn’t report
You claimed non-deductible expenses
You filed an incomplete tax return
You made a mistake when calculating your taxes
You inadvertently under-reported your income
You misinterpreted the taxation law
You’ll be doing yourself a huge favor by coming forward and correcting your mistakes because the CRA has sources reporting financial information that will include your income. If you don’t act when given a chance, the law will catch up with you eventually.
Be aware that you won’t automatically qualify for relief under the Voluntary Disclosure Program. You must fulfill the following criteria:
You’re coming forward voluntarily and not after receiving a notice from the CRA.
You’re likely to incur penalties.
You’re filing a later return or correcting a previous error.
Get Professional Help
Unless you’re an expert in taxation matters, you should not try to interpret tax laws. The CRA has imposed stringent criteria for taxpayers to meet before they qualify for the VDP. You’ll have a better chance of succeeding in your application if you seek help from a professional.
Messing with the CRA can lead to severe repercussions. You could incur heavy penalties and even end up in prison.