TAX NEWS - 2010

Canada Tax: Canada Revenue Agency (CRA) revises policy on access to information

Following several years of consultation and discussion with taxpayers, the tax professional community and other interested parties, the Canada Revenue Agency (CRA) has released a revised policy on its right to access information from taxpayers and others, such as auditors or advisors. The policy, entitled "Acquiring Information from Taxpayers, Registrants and Third Parties," communicates the broad rights of the Canada Revenue Agency (CRA) to review taxpayers' books and records, as well as relevant information in the possession of others, in the course of conducting an audit, inspection or examination.

Canada Revenue Agency (CRA) indicates a commitment to a cooperative and constructive approach, noting five principles that will be taken into account by its officials when requesting information from a taxpayer or other person:

1. Legislative authorities – The CRA has broad legislative authority to request information to ensure compliance with tax law;

2. Intent – CRA officials will clearly communicate their intent when requesting information, as well as changes in scope in the course of an audit or review;

3. Relevance – Information sought should be considered relevant to the audit or review being carried out;

4. Transparency – Canada Revenue Agency (CRA) officials will clearly identify issues being reviewed and encourage clear and open communication from taxpayers and other persons; and

5. Impartiality – Canada Revenue Agency (CRA) officials will be objective when reviewing information and will not be influenced by opinions or subjective comments contained in the information.

Canada Revenue Agency (CRA) anticipates that this policy will facilitate efficient and effective communication with taxpayers and advisors.