How to fix a CRA mistake? | Income tax filing | Discussion forum

Please consider registering
guest

sp_LogInOut Log In sp_Registration Register

Register | Lost password?
Advanced Search

— Forum Scope —




— Match —





— Forum Options —





Minimum search word length is 3 characters - maximum search word length is 84 characters

sp_Feed Topic RSS sp_TopicIcon
How to fix a CRA mistake?
July 4, 2020
7:31 am
savemoresaveoften
Member
Members
Forum Posts: 748
Member Since:
March 30, 2017
sp_UserOfflineSmall Offline

Submitted my return mid May and they did an assessment (per online will see the assessment posted next week). However I see there will be a refund instead of I need to pay tax for the following silly reason:

I sent in paper copy and as such I guessed a CRA rep actually type it in (I thought they just use the electronic receipt they rec from source but may be not entirely true).

The reason I am getting refund from them is the CRA rep put in a $$$$ tuition expense tax credit. I never claim nor submit a schedule 11 (haven't been in school since the 90s). The amount they put in is the exact amount I submitted for capital gain. That results in a tax refund per them...

Now how do I go about fixing an error they make ? Do I submit a "change tax return" online even tho it was them who mess it up ? I just want it to be correct as I am sure down the road they will audit and reverse. Certainly don't want them to then charge me interest on owed tax etc and become a bigger mess to unwind.

The other issue is if I just pay them the "actual amount" that I know I owe, then they will just refund it back to me cuz they don't carry credit balances...

It's an annoying issue for sure. Any advice or experience you may have is appreciated.

July 4, 2020
10:09 am
AltaRed
Member
Members
Forum Posts: 1535
Member Since:
October 27, 2013
sp_UserOfflineSmall Offline

Phone CRA and tell them the error and why. Or ask (by written letter) for a re-assessment and tell them why, e.g. CRA data entry error on Schedule 11 rather than Schedule 3 per submitted paper return. I am not sure, but I think you can upload a PDF letter on MyAccount asking for a re-assessment.

I would not use a T1A or a Change Tax Return since you submitted the correct information. My suggestion for the future is to avoid paper returns if at all possible (some tax software is free). CRA has not trained all the monkeys well enough to ensure correct data entry of all the key information on your paper return.

July 4, 2020
12:54 pm
Bill
Member
Members
Forum Posts: 2633
Member Since:
September 11, 2013
sp_UserOfflineSmall Offline

I would sign in to My Account, on first page under Tax Returns select Change My Returns and it will lead you through to change any lines(s) you want, i.e. in your case remove the amount on the tuition line and add the amount on the taxable capital gain line.

As you are making a change to their assessment, make sure to do this after the Notice of Assessment date, sounds like sometime next week for you.

No need to call and explain, unless you prefer to. But CRA errors like this can cause future liability, so you're right to make the adjustments.

CRA will issue a new Notice of Assessment and then you can send them what you owe them.

July 4, 2020
1:14 pm
AltaRed
Member
Members
Forum Posts: 1535
Member Since:
October 27, 2013
sp_UserOfflineSmall Offline

Why? The OP said he sent the paper filing in correctly. It was CRA that did a Data Entry error.

July 4, 2020
1:26 pm
Bill
Member
Members
Forum Posts: 2633
Member Since:
September 11, 2013
sp_UserOfflineSmall Offline

Yeah, I know, but I saw a 2016 Globe and Mail article when I googled it and some tax guy said you're responsible for reviewing your assessment notice and making sure it's right, that it doesn't matter who made the error, CRA could always come back later for the right amount, plus interest, so amend your return no matter whose error it is. Maybe he's full of it, I don't know.

Sure, you can call them up and get them to fix it, I just figure based on tax guy's comments it's a lot quicker not to worry about whose fault it is and just do it via My Account, probably take 5 minutes, new NOA issued, done.

Last year I realized I had omitted some deductions for 3 years so I went into My Account, amended 3 years worth of returns in about 10 minutes, ended up getting 3 deposits totaling about $800 into my bank account, so I'm biased, love My Account vs trying to call them.

July 4, 2020
1:45 pm
AltaRed
Member
Members
Forum Posts: 1535
Member Since:
October 27, 2013
sp_UserOfflineSmall Offline

I have done similar online several times over a number of years but it was my initiative to change my returns to changes I wanted... not to correct a CRA data entry error.

However, it may well be the most effective way to do it. There is a place in the T1A to provide reasons.

July 4, 2020
3:38 pm
Bill
Member
Members
Forum Posts: 2633
Member Since:
September 11, 2013
sp_UserOfflineSmall Offline

Now that you mention it, there are 2 things you can do on My Account. The Change My Returns option is just that, changing your return, what you did in previous years, AltaRed. It's not appealing or objecting to your assessment, so no reasons provided, no T1A, etc, just changing previously assessed line amounts. Like you I've used this and it works great, I'm assuming it would work in this case too.

The other way, formally objecting to your Assessment, involves clicking instead on "Register my formal dispute", and only there is there a place for a narrative re your reasons for objecting. Maybe that's the better way to go in this case, now that I think about it. There's a time limit, 90 days from the date of the Assessment or up to a year, in this case. Problem with this is the Appeals branch can take a year or so to get to it. I think I'd still try the first way in this case, see what happens, if it works or not you'll know pretty quickly when you see your new Assessment Notice. Since no money's payable until the end of next month there's time.

July 4, 2020
6:19 pm
savemoresaveoften
Member
Members
Forum Posts: 748
Member Since:
March 30, 2017
sp_UserOfflineSmall Offline

Thanks for the input guys. There is no upside for me to "tell" CRA they screw up, just want to make it right so proper tax amount is calculated and I pay it before Aug31.
So based on your experience, when I do a online "change tax return" once the assessment is issued, it is fairly automatic and it will reissue a new assessment within days ?
Yeah the ultimate goal is to have the proper tax assessment by August so I can just pay what I owe and not worry about any interest/penalty that will require a reversal and further complicates matters.

July 4, 2020
7:21 pm
Bill
Member
Members
Forum Posts: 2633
Member Since:
September 11, 2013
sp_UserOfflineSmall Offline

Yeah, my only experience with the change my return option was as I said, re 3 years affecting one line each year and within a few weeks I had a new Assessment Notice, my money, no questions asked, that was about 2 years ago I think. And the amount was only $800. In your case, you're actually increasing your amount payable, so either they'll be happy to accept it without scrutiny or else they'll kick it out for a closer look because who amends returns to send in more money unless they're a cheater, who knows what their computer thinks?

As I said, I'd do it that way, you seem to know what's happening and you're on it, can check your My Account every week or so until you see it, and then send in your money. If it's not done by August end, you can just send them what you think you owe to be safe. In any event, it makes sense to do it this way to me, even CRA wouldn't expect someone to formally go through the appeal process in order to pay more tax (they're very conscious of people going to media with CRA shenanigans) - although I happen to know some CRA auditors who call their Appeals dept "the gift shop" because they are essentially a pr dept and like to reverse auditor assessments to be nice to those who make innocent errors - so I suppose if you went that way you might ultimately be let off, who knows?!

July 7, 2020
5:44 pm
savemoresaveoften
Member
Members
Forum Posts: 748
Member Since:
March 30, 2017
sp_UserOfflineSmall Offline

I contacted CRA and the call was suprisingly painless (did wait for 40mins before someone picks up, and then transfer to another person).
Had to explain what is going on and thankfully the rep I got is relatively smart and understand the issue quite quickly. She then check if she can change it, but turns out the tuition credit is something she cant touch. She then walked me thru doing the "change my return" while she stays on the phone. After I hit submit, she checked and confirmed the system took it already and a reassessment will be issued over the next week or so.
She also mentioned since I am reversing a credit and thus paying more tax, shes pretty sure they will just waive it without checking it at all (hence the 1 week turn around for the new reassessment.

July 8, 2020
5:33 am
Bill
Member
Members
Forum Posts: 2633
Member Since:
September 11, 2013
sp_UserOfflineSmall Offline

Aside from the wait sounds like top-notch service from CRA agents, nice to hear.

Please write your comments in the forum.