CRA Delays: What to Do About the Hours on Hold

Evelyn Jacks

Is it reasonable to expect Canadians to spend 2 hours or more on hold to get answers to their tax questions at CRA or even change their address?  Taxpayers and their advisors are increasingly frustrated with long wait times for service.  The CRA Ombudsman is looking into it, according to a CBC report, but the ombudsman’s office, too, is behind on  complaint processing; backed up to the last week of June.   It’s a big problem, as taxpayers are bound to strict deadlines for compliance or face expensive penalties and interest costs.  So, what can be done?

First, if the complaint matter is urgent, the Ombudsman suggests calling directly to 1-866-586-3839.  Second, many communications can be done online using MyAccount, but that assumes a certain level of computer and tax savvy.  Leaving those communications to a DMA™ - Tax Services Specialist can be helpful to preserve appeal rights and also to get answers from the right people at CRA.   

Most important, taxpayers have rights to timely communications, and CRA has published a guide to those rights.  Specifically, Right #6 and #9 addresses the issue, but takes the taxpayer down a further time-consuming bureaucratic road:

“6. You have the right to complete, accurate, clear, and timely information. . .Our enquiries agents have extensive training and reference tools that let them respond quickly and accurately to your questions and provide you with the highest quality of service.  If you feel the information you received from us was inadequate. . . 9. You have the right to lodge a service complaint and to be provided with an explanation of our findings.”

Using the complaints and appeals processes available are important however, because the CRA has the power to remove penalties and interest charges if delays at their end cost taxpayers money.  While the taxpayer always has to pay the taxes properly calculated and due, relief of penalties and interest charged in the following instances is possible if they prevent the taxpayer from meeting obligations to the CRA::

• extraordinary circumstances the taxpayer is experiencing, like floods or fires, serious illness or a death in the family for example;
• actions of the Canada Revenue Agency (CRA); specifically:
  • processing delays that result in taxpayers not being informed, within a reasonable time, that an amount was owing;
  • errors in CRA material which led a taxpayer to file a return or make a payment based on incorrect information;
  • incorrect information provided to a taxpayer by the CRA;
  • errors in processing;
  • delays in providing information, resulting in taxpayers not being able to meet their tax obligations in a timely manner; and
  • undue delays in resolving an objection or an appeal, or in completing an audit.
• inability to pay or financial hardship; but here full financial disclosure is required to provide background information to meet the eligibility for potential penalties or interest relief:
  • financial hardship and inability to pay because of loss of employment;
  • financial hardship due to the fact that interest charges from the CRA represent a significant portion of the payments due; or
  • financial hardship caused by the accumulated interest which would result in a “prolonged inability to provide basic necessities such as food, medical help, transportation, or shelter”.  In that case, CRA may give consideration to cancelling all or part of the total accumulated interest.
• other circumstances

But wait, that department too is jammed up.  Their site says the following:

“Under normal circumstances, the Canada Revenue Agency (CRA) aims to issue a taxpayer relief decision within 180 calendar days of receiving the request. However, we are receiving a higher than normal number of requests. We are processing requests within eight months for most cases, but it could take longer for more complex cases.”

Six to eight months to process a request for taxpayer relief when interest costs are compounding daily at high prescribed interest rates – currently 9%?  No wonder taxpayers and their advisors are frustrated!  It’s something they may wish to take up with their local MPs.

Bottom Line:  Despite receiving $400 Million in last fall’s November Economic Report, tagged specifically to improve customer services, taxpayers and their advisors are stuck in bureaucratic delays at the CRA, their CRA Ombudsman’s office and in exercising their Taxpayer Rights to timely and accurate service.  Meanwhile the expensive interest clock is ticking.  Submitting a request for taxpayer relief sooner rather than later would appear to be a smart move when the government is to blame for the delays. 

The topic of audit defence, particularly with a focus on real estate assets and transactions will be the subject of the September 20 CE Summit.  Check out the comprehensive agenda and register by September 15 for an early bird tuition reduction.  Qualifies for CE Credits and Tuition/Canada Training Credits for eligible taxfilers.