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Duca T5 error
April 14, 2021
6:18 am
HISAhopper
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Duca informed me that the was small error on the their T5 related to loyalty bonus (my guess it is the $14 interest/bonus on the special account). They said they are working with CRA to resolve the issue and the amended T5 will be sent out and advise me to contact CRA if I am to file my tax return before Apr 30.

Apr 30 is the dead line for filing, it sounded like their amended T5 won't be able to make it before Apr 30. It was 45 min to 1.5 hrs waiting on the phone as i called CRA recently and am very discouraged to have to go through that again.
I am thinking of using the existing T5 to file knowing there is error in it.
Any advice?

April 14, 2021
6:58 am
BillieBob
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HISAhopper said
Duca informed me that the was small error on the their T5 related to loyalty bonus (my guess it is the $14 interest/bonus on the special account). They said they are working with CRA to resolve the issue and the amended T5 will be sent out and advise me to contact CRA if I am to file my tax return before Apr 30.

Apr 30 is the dead line for filing, it sounded like their amended T5 won't be able to make it before Apr 30. It was 45 min to 1.5 hrs waiting on the phone as i called CRA recently and am very discouraged to have to go through that again.
I am thinking of using the existing T5 to file knowing there is error in it.
Any advice?  

I had already filed my income tax return by the time I received the email from DUCA. I seem to remember the email stating it would not have a major affect on my income taxes so I am not concerned about it.

April 14, 2021
7:28 am
Alexandre
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You can amend your tax return later, if you find there is a need to do so. The process is not so hard for minor changes in tax return.

How to change your return - Canada.ca

April 14, 2021
8:11 am
HISAhopper
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thanks guys

April 14, 2021
12:17 pm
Londonguy
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HISAhopper said
Duca informed me that the was small error on the their T5 related to loyalty bonus (my guess it is the $14 interest/bonus on the special account). They said they are working with CRA to resolve the issue and the amended T5 will be sent out and advise me to contact CRA if I am to file my tax return before Apr 30.

Apr 30 is the dead line for filing, it sounded like their amended T5 won't be able to make it before Apr 30. It was 45 min to 1.5 hrs waiting on the phone as i called CRA recently and am very discouraged to have to go through that again.
I am thinking of using the existing T5 to file knowing there is error in it.
Any advice?  

I got the same email from DUCA, but not until long after I had already filed.

Just go ahead and file your taxes based on the information you have. Then wait for DUCA to file their amendment and for CRA to do their thing in response. Since the mistake was the fault of the issuing party (DUCA) and not you, CRA isn't going to do anything other than possibly send you a re-assessment notice in the summer asking for a couple of extra bucks of tax on the few dollars of income DUCA failed to report.

If you do receive such a notice a few months from now, as long as you pay the amount that CRA requests within the time frame they set, there will be no penalty and no interest charge to you. You get the notice, you pay up, and you're done. I've been issued these types of notices before and it's no big deal.

It's also quite possible that because of the prohibitive cost of re-assessing people for small amounts of unreported income just to retrieve a dollar or two of tax, CRA might not even bother doing it for individuals where the discrepancy is below a certain amount. In the meantime there's nothing you can do except carry on and not be surprised if a notice shows up one day

April 14, 2021
4:50 pm
Loonie
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The amount would have appeared on your Jan 2020 statement as "Class A share - Dividend".
There is a line on the CRA form for Other Interest etc. I would try putting the extra bit there.
You could also try just bumping up your T5 from DUCA, but there is the risk that CRA would adjust it downwards when assessing your return, in the absence of a revised T5.

Our accountant, who is obviously not very familiar with credit unions, tried to count it as an "eligible dividend", with dividend tax credit, and I had to correct him. Beware! Pending...

I am expecting a refund and don't want to have to fiddle around sending them money later so am trying to include it in my return. My guess is that by the time they assess my return the new T5 may be available and will provide the reference point for CRA. They may issue a reassessment, but it shouldn't involve paying extra money.

I suspect the problem may have come about when they did a major upgrade in their computer systems last summer.

The only sure thing is that you'll have to pay the tax on it one way or another!

April 14, 2021
7:49 pm
HermanH
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I encountered a similar problem with IA Clarington funds last year. They issued me a late T3, so I filed using form T1-ADJ. It was quick and easy.

To their credit, Clarington allowed me to submit a claim for expenses associated with re-filing due to their error. I requested and received $100 for the time spent spent online and costs associated with re-filing.

April 15, 2021
12:41 pm
frizun
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They sent me a e-mail saying they would send out the amended T5's this week and should arrive before April 30.
Checked my T5 in online banking..was not amended yet...so we wait.

April 15, 2021
5:27 pm
AltaRed
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As already articulated, if it does not come in time, then file with the existing T5 and AFTER your return has been assessed and you have your NOA, do a ReFILE with your tax software assuming you NETFILED your tax return. The better tax software (maybe all tax software) provide an online Refile option. If not, then CRA MyAccount T1A option is the best way to go.

Case in point: A family member filed their tax return on circa Apr 2nd or so via NETFILE with UFile. Brokerage came back late last week and said there was an error on a T3 tax slip. Got it this week and went back into UFile, selected the ReFILE option, adjusted the T3 box amounts and re-filed. All done in about 10 minutes.

April 16, 2021
12:16 pm
savemoresaveoften
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frizun said
They sent me a e-mail saying they would send out the amended T5's this week and should arrive before April 30.
Checked my T5 in online banking..was not amended yet...so we wait.  

I recd the snail mail today dated Mar31 about it being wrong lol

I also checked my 2019 T5 and other than box13 interest, I dont see anything re this interest bonus member thingie. Was it part of the box13 ?

April 16, 2021
5:15 pm
Loonie
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The revision should show an increase in Box 13.
If you have a DUCA T5 from the previous year, you should be able to figure out that it was included then.

April 17, 2021
5:23 am
savemoresaveoften
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Loonie said
The revision should show an increase in Box 13.
If you have a DUCA T5 from the previous year, you should be able to figure out that it was included then.  

I did not check the math if they calc my interest correctly. I just did quick top of the head calc to see if any promised bonus is paid out. So as long as what they give is more than what I estimate, that is good enuf for me.
I rely on the collective wisdom here to point out if any FI or CU interest calculation is funky and then check it if it applies to me too 🙂

April 17, 2021
7:25 pm
Loonie
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I'm not sure I'm following you, but the bonus would show on your January 2020 monthly statement as Class A shares deposit - if you have access to that statement. Mine has disappeared from my online record but I had it printed out earlier.

April 18, 2021
4:58 am
savemoresaveoften
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Did a deeper dive and noticed the following:

They did not generate a Jan 2020 statement in my account so cant compare. Not sure what is their criteria for generating statements as I have a few missing ones under estatement.

In Mar 2021 statement, my class A bonus share acct balance goes up by $4.
But they also added a new account called Daylight Savings account and somehow there is $99 in it. No clue what this account is as I did not even know it exists until I check today.
Does that mean for 2020, I earned a total of $103 as some form of bonus ? That seems generous.
So I imagine they are missing the $99 in the T5 since it is something new they create maybe ?

April 18, 2021
8:13 am
COIN
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savemoresaveoften said
Did a deeper dive and noticed the following:

They did not generate a Jan 2020 statement in my account so cant compare. Not sure what is their criteria for generating statements as I have a few missing ones under estatement.

In Mar 2021 statement, my class A bonus share acct balance goes up by $4.
But they also added a new account called Daylight Savings account and somehow there is $99 in it. No clue what this account is as I did not even know it exists until I check today.
Does that mean for 2020, I earned a total of $103 as some form of bonus ? That seems generous.
So I imagine they are missing the $99 in the T5 since it is something new they create maybe ?  

What is the "de minimis" amount for a T5? Some institutions issue T5's for every penny because it is simpler to just do a "data dump" than to filter out smaller amounts.

April 18, 2021
4:39 pm
Loonie
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What a mess!

My January (and Feb and March) statements for 2020 are no longer available either, but, when they were doing the changeover of computer systems last summer, I printed out everything I could get my hands on as I was afraid some of it might disappear, so I do have the statement.

I suggest you compare what is in your Class A Bonus Shares account at end of 2019 with whatever it shows at the earliest available point in 2020. The difference between them (never mind a few pennies interest) will be the amount in question. But you could just wait for the new T5.

I have no idea what a Daylight Savings Account is. This one doesn't appear on my statement.

They have far too many accounts. They spring up unbidden - and never leave! I have been meaning to phone them and see if I can get rid of one or two of them but figured they'd be swamped with calls now.

As far as I know, FIs must issue a T5 when there is at least $50 income. In the situation with DUCA, the bonus shares may be less than that, but the total including regular interest is likely more, so it must be included.

April 19, 2021
6:41 am
savemoresaveoften
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Just talked to Duca this morning. The paper copy of the revised T5 was mailed out last week. They are in the process of uploading the ecopy to the online profile.
So we should all receive at least the paper copy some time this week.

April 20, 2021
6:20 am
HISAhopper
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I received the amended T5 yesterday with exactly $14 added on to interest income which is the amount in the Class A account.
I tried if I can transfer it to other account but to no avail. It is my money as I pay interest on it, why can't I use the money anyway I want?
if I want to close all DUCA accounts will I be able to collect the $14? If no, then to be fair DUCA must reimburse the interest that I pay to CRA.
Any thought?

April 20, 2021
7:47 am
topgun
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HISAhopper said
I received the amended T5 yesterday with exactly $14 added on to interest income which is the amount in the Class A account.
I tried if I can transfer it to other account but to no avail. It is my money as I pay interest on it, why can't I use the money anyway I want?
if I want to close all DUCA accounts will I be able to collect the $14? If no, then to be fair DUCA must reimburse the interest that I pay to CRA.
Any thought?  

I received $5 from a different CU. The amount included with interest on T5. The amount is not available to me since it is added to member shares. If I closed the account I would get the extra cash back.

Have a Great Day

April 20, 2021
7:56 am
GR
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HISAhopper said
I received the amended T5 yesterday with exactly $14 added on to interest income which is the amount in the Class A account.
I tried if I can transfer it to other account but to no avail. It is my money as I pay interest on it, why can't I use the money anyway I want?
if I want to close all DUCA accounts will I be able to collect the $14? If no, then to be fair DUCA must reimburse the interest that I pay to CRA.
Any thought?  

Your typo of paying "interest" should, of course, read paying "income tax".
Here's my understanding of the situation. Their Class A bonus shares dividends are shown as interest income, not dividend income, for tax purposes. The full amount is taxed in the year posted, but is not available to the member. The member can only redeem a portion, starting in year 2 at 50%, year 3 at 60%, etc. 100% can only be redeemed if the member waits 6 or 7 years! If redeemed at less than 100%, the member forfeits the balance, but the member has already paid tax on the full amount when posted initially! I believe the only recourse to adjust would be to treat the uncollectable portion forfeited as a deduction from all other interest income in the year forfeited or treat that amount as "bank charges, etc."

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