2020–21 Departmental Results Report

Throughout this report, areas of focus for the CRA are highlighted by the icons described in the following table.

Results at a glance

Tax

Canada’s self-assessment tax system is sustained by providing clients with the support and information they need to understand and fulfill their tax obligations, by taking compliance and enforcement actions when necessary to uphold the integrity of the system, and by offering avenues for redress when clients disagree with an assessment or decision.

Benefits

Clients obtain the support and information they need to know what benefits they may be eligible to receive, that they receive their benefit payments in a timely manner, and have avenues of redress when they disagree with a decision on their benefit eligibility.

Performance Summary

In the 2020–21 fiscal year (April 1, 2020 – March 31, 2021), the CRA identified five strategic priorities to help achieve its core responsibilities:

• providing a seamless service experience
• maintaining fairness in Canada’s tax and benefits administration
• strengthening trust, transparency and accountability 
• enabling innovation
• empowering CRA’s people to excel

In pursuing these priorities, the CRA achieved the following key results:

• met or mostly met 67% of external service standards targets (target 90%)
• sent a total of 366,174 letters to Canadians who had not filed their 2018 taxes to inform them of the benefits and credits they were eligible for
• enabled clients to view more of their tax information on the My Business Account online portal
• continued to offer personalized services and outreach virtually during the COVID-19 pandemic:
  • the Benefits Outreach Program conducted 3,431 virtual outreach activities, including 65 with Indigenous communities  
  • the Liaison Officer Service contacted 160,000 businesses and held 502 virtual group seminars

* May 16, 2020, to May 15, 2021

** Includes COVID-19 economic response plan top-up amounts for the GST/HST credit and the Canada child benefit.

• implemented measures to strengthen the protection of personal information, including the enhancement of the Enterprise Fraud Management Solution to proactively monitor user actions on CRA systems
• responded quickly to the summer 2020 cyber incidents, experienced by the CRA and the Government of Canada, by taking action to uphold the integrity and security of taxpayer information and accounts. The CRA also works with its government counterparts, including the Canadian Centre for Cyber Security and the Treasury Board of Canada Secretariat to continue to respond to attacks on CRA’s online systems

• approved a three year innovation plan and also committed $10 million to an Innovation Fund to support experimentation over the next three years
• worked to support the government’s reconciliation mandate by implementing a strategy for the recruitment, inclusion and retention of Indigenous peoples

In carrying out its core responsibilities, the CRA used 14 indicators to measure its progress in achieving its departmental results. It set targets for 13 of these indicators: 

• six met their target
• six did not meet their target
• data was unavailable for one indicator

In working toward these results, the CRA’s actual spending was $9,983,977,939 and its actual full-time equivalents were 43,324.

For more information on the CRA’s plans, priorities and results achieved, see the Results section of this report.

COVID-19

Administering emergency measures

On March 11, 2020, the World Health Organization declared the COVID-19 pandemic. On March 12, 2020 the CRA activated its Incident Management Committee and on March 15, 2020, the CRA activated its National COVID-19 Business Continuity Plan to ensure that it could continue to support Canadians with the delivery of critical services^{Footnote 2} during the pandemic. Decisions were taken from the perspective of ensuring business continuity as well as the support and safety of the CRA’s workforce, but also to manage the CRA’s contribution to the broader Government of Canada response, especially as it related to helping Canadian individuals and businesses cope with the economic impacts of the pandemic.

The CRA demonstrated its capacity and agility by rapidly launching new programs and modernizing its service offerings. For example, it implemented the Canada Emergency Rent Subsidy (CERS) in November 2020, within 6 weeks of its announcement by the Deputy Prime Minister and Minister of Finance.

Benefits administered by the CRA helped to reduce the financial burden on Canadians generated by the pandemic. In addition, measures such as extensions to the CRA’s filing and payment deadlines helped provide flexibility to Canadians experiencing hardship. The CRA played a key role in ensuring changes to existing programs were compassionate and implemented in a timely manner.

The activation of the National Business Continuity Plan and the work from home directive for employees, impacted the delivery of the CRA’s programs and services. Most tax compliance programs and corporate functions were initially suspended as the CRA focused on the administration of the new and supplementary benefits and the delivery of critical services. As the internal and external environment evolved, the business continuity plan was updated to reactivate certain services and modify work restrictions for employees. However, most CRA employees continued to operate in a virtual environment.

The tables below show the benefits and subsidies that the CRA administered in 2020–21, as part of the Government of Canada’s Economic Response Plan.^{Footnote 3}  Additional COVID-19 measures, as they relate to the achievement of the CRA’s priorities and objectives are reported in the Results section. 

Table 1: Benefits introduced for individuals in 2020–21 and 2019–20 benefits continued into 2020–21

In addition to administering these benefits, the CRA gave information to Employment and Social Development Canada (ESDC) on individuals eligible for the Disability Tax Credit (DTC) in the 2020 tax year. This helped to support ESDC to deliver a one-time tax-free payment of up to $600 to eligible individuals with disabilities.

Table 2: Subsidies for businesses introduced in 2020–21 and 2019–20 subsidies continued into 2020–21

The CRA is committed to maintaining a balance between making emergency funds accessible to businesses who urgently need this support, and preserving the fairness and integrity of the tax system, while administering the rules adopted by Parliament. The CRA does its due diligence and ensures those receiving emergency response benefits are in fact eligible for them. The CEWS comprehensive audit program, for example, consists of many compliance activities, including automatic and manual pre-payment verification, post payment audits, a claimant registry and repayment opportunities.

The CRA worked with businesses and stakeholder organizations as the CRA’s response to the COVID-19 pandemic evolved. For example, in 2020–21, the CRA:

• hosted or participated in 47 interactive question and answer sessions for small and medium businesses, employers and stakeholder organizations to provide updates and clarification on the COVID-19 relief measures and to seek feedback on the measures and their delivery. These sessions reached over 19,000 participants and engaged over 16,500 unique organizations
• published guidance to help applicants apply for benefits. The CRA had more frequent informal discussions with stakeholders to ensure any concerns would be addressed in a timely manner
• worked with financial institutions and the Office of the Superintendent in Bankruptcy to suspend and resume certain collections and compliance activities to minimize the financial burden on Canadians
• participated in a Canadian Federation of Independent Business webinar to provide clarity on the CERS subsidy
• worked with community organizations and volunteers participating in the Community Volunteer Income Tax Program to implement and host virtual tax preparation clinics for vulnerable individuals to help them file their taxes and access the benefits and credits they were eligible for
• recognized electronic signatures to reduce the need for taxpayers and tax preparers to meet in person

The CRA administers provincial and territorial tax programs, benefits, and credits for taxpayers across most Canadian jurisdictions. The most notable exception is Quebec, which administers their provincial tax programs in parallel with the CRA. The risk of miscommunication between the CRA’s federal, provincial and territorial partners increased considerably given how rapidly the COVID-19 situation was evolving.

In response, the CRA:

• increased the frequency of formal meetings to make sure the CRA’s provincial and territorial partners were informed of its plans before decisions were made
• worked closely with its partners in Quebec to ensure that the relief measures announced in the COVID-19 Economic Response Plan were aligned with similar measures being announced by the Government of Quebec. This included coordinating responses, aligning perspectives between organizations, and clarifying ambiguities before announcements were made
• worked with the Government of Alberta, which administers the corporate income tax program, to coordinate relief measures for the corporate sector
• provided provinces and territories with data on the CRA’s COVID-19 relief measures and regular updates on measures being implemented to the benefit and credit programs, such as the introduction of various contingency measures aimed at ensuring individuals were not negatively impacted by an extension to the income tax return filing deadline

The CRA also offered support to provinces and territories in administering modifications to their existing programs. As examples, the CRA supported the implementation of these additional measures:

• British Columbia extended certain time limits for tax credits, including the film and television, book publishing and interactive digital media tax credits, by six months
• Saskatchewan reduced its small business tax rate from 2% to 0%, beginning October 1, 2020; and will slowly increase the rate throughout pandemic recovery to 1% beginning July 1, 2022, and then back to its current rate of 2% beginning July 1, 2023
• Nova Scotia provided a one-time extension of the filing deadline for time limits with respect to the research and development tax credit. The time limit was extended by six months
• Ontario extended the time periods for the timing of eligible labour expenditures for the book publishing tax credit. It temporarily allowed an additional 24 months to meet the minimum spending requirements threshold for eligible expenditures incurred during the 2020 and 2021 tax years for the Ontario production services tax credit, the Ontario film and television tax credit, and the Ontario interactive media tax credit. It also extended the period for the Ontario research and development tax credit and introduced the regional opportunities investment tax credit.

The CRA also expanded its secure electronic exchange of documents with international partners to share guidance and best practices on tax administration responses to COVID‑19, including the implementation of fiscal measures and ensuring business continuity. It also collaborated with international partners on emerging trends related to the pandemic and shared best practices in managing the impacts of the pandemic.

Impact on operations

The activation of the National Business Continuity Plan to address the COVID-19 pandemic significantly changed the CRA’s work environment. By activating the plan and focusing on the delivery of critical services, the work of thousands of employees who were providing public-facing and enabling services to Canadians and internal stakeholders was either suspended or changed. In response, the CRA adjusted the way it delivered the programs and services on which Canadians depended.

Approximately 95% of employees who were performing critical services were working from home. The shift to work-from-home posed a risk to service delivery as employees were no longer able to receive or send mail or faxes to taxpayers and many call centre agents were no longer able to respond to taxpayer questions.

To address these risks and continue to deliver critical services, as well as deal with the additional workload associated with the new COVID-19 benefits, the CRA quickly expanded remote work capabilities and deployed technologies and equipment so that employees had the tools necessary to continue providing client-centric service and innovate in response to the pandemic.

Call centres are an important piece of the service delivery experience for many Canadians. Call centres were already receiving a high volume of calls when the Government announced its COVID-19 Economic Response Plan. The pandemic declaration, the numerous announcements about changes to CRA services and the new relief measures increased the volume of calls made to CRA call centres. This put a strain on call centre infrastructure and agents. The CRA implemented two key solutions to mitigate the risk to business continuity:

• supplemented the existing call centre technology infrastructure to handle the increased volume of calls and to enable an increased number of simultaneous agents that could be supported by the systems
• reassigned employees who were not delivering critical services to act as temporary call centre agents in support of the new emergency relief measures. In response to a national call in March 2020, approximately 7,000 employees agreed to change functions to ensure that Canadians and businesses could continue to be supported. Of these, nearly 4,000 employees were reassigned as temporary call centre agents in the following weeks and months

The CRA continued to demonstrate its commitment to its People First philosophy by placing the health, safety and security of its workforce as a primary strategic objective. The work from home directive, issued early in the pandemic, was instituted to respect public health guidelines to reduce the risk of exposing employees, volunteers and taxpayers to COVID-19. The CRA also developed a tracking tool to track employees who tested positive for COVID-19 or had been in contact with someone who tested positive and ensured that sound protocols were in place for employees who needed to go to the office.

The CRA continually monitored the productivity and mental health concerns of employees and their managers. It developed additional resources and reminded employees of the services available to support their well-being. The CRA kept employees informed about the pandemic disruption, sharing timelines, plans and updates as they were available. Greater detail on the actions taken by the CRA to support its managers and employees during 2020–21 is found in the section Empowering the CRA’s people to excel.

Business resumption

Beginning in April 2020, the CRA started preparations to transition towards resuming full business operations. The National Business Resumption Plan was announced on June 29, 2020, which mapped out the initial steps to resume operations. The plan took a phased approach, guided by four business resumption principles: health and safety; fair treatment of clients; service as a priority; and, communication and transparency. Throughout 2020–21, the CRA monitored the evolution of COVID-19 and adjusted the plan, as necessary, to respond to changing public health requirements.

Under the Plan, in 2020–21, the CRA’s employees continued to focus on the new emergency measures while other tax programs that had yet to be activated at full strength would be resumed in a phased manner. In 2020–21, core compliance and collections activities resumed in a strategic, empathetic and people-first manner. The CRA collections approach placed a stronger emphasis on empathizing with the individual circumstances of debtors, recognizing that Canadians have been impacted in many ways by COVID-19. The full scope of collection activities only gradually resumed in January 2021, and by mid-February, all collection activities had resumed while continuing with a people first, empathetic approach.

Conclusion

To support Canadians and businesses facing hardship as a result of the pandemic, in 2020–21, the CRA demonstrated its agility by mobilizing its employees and allocating resources to administering new programs and programs launched in 2019–20, while continuing to provide critical services to Canadians. The CRA’s work in recent years to transform into a client-centric, digital organization positioned it well to respond and support Canadians. However, the magnitude of the response to COVID-19 and the need to adapt to the changing public health and economic circumstances had a significant impact on operations. The CRA empowered its employees by providing them with the technology and tools to enable them to work remotely, while supporting their well-being.

Core responsibilities

Tax

Description: The CRA’s core responsibility for tax is to ensure that Canada’s self-assessment tax system is sustained by providing clients with the support and information they need to understand and fulfill their tax obligations. The CRA also takes compliance and enforcement actions when necessary to uphold the integrity of the system. When clients disagree with an assessment or decision we have made, the CRA offers avenues for redress.

Benefits

Description: The CRA’s core responsibility for benefits is to ensure that clients obtain the support and information they need to know what benefits they may be eligible to receive, that they receive their benefit payments in a timely manner, and have avenues of redress when they disagree with a decision on their benefit eligibility.

Financial, human resources and performance information for the CRA’s Program Inventory is available in GC InfoBase ^{Footnote 33} .

Internal services

Description: Internal services are those groups of related activities and resources that the federal government considers to be services in support of programs and/or required to meet corporate obligations of an organization. Internal services refer to the activities and resources of ten distinct service categories that support program delivery in the organization, regardless of the internal services model in an agency or department. These services are: acquisition management services, communications services, financial management services, human resources management services, information management services, information technology services, legal services, materiel management services, management and oversight services, and real property management services.

Key Risks

The CRA continuously monitors its internal and external environments for events that could impact the achievement of its priorities and objectives. The CRA’s enterprise risk management program is agile and well-established. Enterprise risk management creates an environment where intelligent risk-taking can contribute to innovation. When intelligent risk-taking is encouraged, more effective decisions can be made on the basis of a well-balanced consideration of both the benefits and risks to the CRA. This approach allows the CRA to optimize its outcomes, prioritize its strategies and adapt for the future.

As a result of the COVID-19 pandemic, the CRA increased the frequency of its updates on enterprise risks, as well as its reporting to senior management and the Board of Management. Through the 2020–21 year, a Risk and Control Dashboard was developed to address potential risks to the CRA during the pandemic and to help the CRA adapt to new objectives at a faster pace than ever before and during a period of great uncertainty. This internal tool guided regular discussions on the corporate risks and on appropriate actions to reduce the risks when the CRA prioritized essential services during COVID-19. The CRA has since started enterprise risk assessment updates through the re-designed quarterly Corporate Risk Profile reporting process, which incorporates important lessons-learned from the pandemic.

The table below highlights some of the key risks that influenced the CRA’s ability to meet its objectives. By identifying and managing risks properly, the CRA continues to be well positioned to deliver on its mandate and to maintain the trust and confidence of its clients.

Developing relationships with external partners

The CRA has formed a partnership with the Organization for Economic Co-operation and Development (OECD) Forum on Tax Administration (FTA). In collaboration with the OECD FTA, the CRA developed a reputational risk management maturity model featured in the July 2020 report, Enhancing Reputational Risk Management, published on the OECD’s Forum on Tax Administration communities of Interest Series website. The model can help tax administrations gain insight into the maturity of their reputational risk management practices. The report also provides information on two tools developed by the CRA to help tax administrations actively protect against significant sources of reputational risk.

Inspired by the CRA’s work on reputational risk management, the Internal Revenue Service of the United States began work on a pilot in 2020 for an Enterprise Risk Management (ERM) Maturity Model. The model was refined in 2021 through collaboration with colleagues in the OECD FTA Enterprise Risk Management Community of Interest (COI), including the CRA. The ERM Maturity Model, published by the OECD in February 2021, provides tax administrations with a new diagnostic tool to self-assess their capacity and capability to manage operational risks across their organizations. The ERM Maturity Model pilot provided the CRA with an opportunity to review its risk management function and benchmark it against 27 other tax administrations. Overall, the findings have shown that the CRA’s ERM Maturity Model is a leading and established model in comparison to its peers. The results of the CRA’s self-assessment are encouraging as they reflect the strength and maturity of the Agency’s enterprise risk management function.

Recognizing that ensuring inclusive programming is a social responsibility, the CRA is committed to playing a leadership role in the area of GBA Plus. The GBA Plus Centre of Expertise (CoE) at the CRA is working with branches to raise awareness of GBA Plus requirements. To support the Government of Canada’s priority for a more robust GBA Plus analysis, the CRA developed the GBA Plus Action Plan 2019–22 organized around five key goals:

• increase CRA awareness
• collaborate with key partners
• increase application of GBA Plus
• increase GBA Plus capacity and improve quality
• improve performance measurement and data quality

The overall aim of the plan is to close existing gaps and ensure that GBA Plus is integrated more rigorously and consistently across the organization. This will help inform decision-making and ensure CRA programs do not inadvertently negatively impact clients served. To fulfill the commitment of implementing GBA Plus across the organization, in 2020–21, the CRA undertook GBA Plus assessments of its policies, programs, and services to ensure that they were developed with equality, diversity and inclusion in mind.

Additionally, the CRA participates in the Gender Balance Network led by the Organisation for Economic Co-operation and Development. This is an international network that provides information and examples of addressing disparities and closing the gender gap, particularly in leadership positions where historically women have been underrepresented compared to men.

T1 processing educational nudge campaign experiment

The CRA employed an educational nudge campaign that used information letters to educate taxpayers about claims and deductions made on their 2019 tax returns. The objective was to elicit a response from the recipients of the educational letters that would lead them to voluntarily and correctly request adjustments to their tax returns. The campaign targeted taxpayers who had a 2018 claim denied or adjusted by the Processing Review program and who made a claim for the same field on their 2019 return. Randomized Controlled Trials were used to evaluate the effectiveness of the educational letters, which demonstrated that the campaign had a somewhat positive effect with a small proportion (fewer than 1%) making voluntary adjustments to their 2019 returns. Future nudge campaigns will be enhanced with first, a greater understanding of similarities and differences in the target population, and second, with larger sample sizes.

Mitigating excess online traffic in the roll-out of the Canada Emergency Response Benefit

In preparation for the launch of the Canada Emergency Response Benefit (CERB) in March 2020, there was a concern that the CRA’s system would not have sufficient capacity to handle what was expected to be unusually high online traffic from applicants seeking to enroll in the CERB. To manage the volume of online traffic, behavioural economics techniques were used to help applicants enter a manageable queue based on their month of birth. The CRA’s communications efforts emphasized this ordered approach to queuing for the CERB, and the website was designed to lead an applicant to select the suggested day to apply. This helped distribute the volume of applicants over time and meant that the CRA’s system would not be overloaded due to high volumes of applicants rushing to apply. The CRA’s data analysis confirmed that the attempt to distribute applicants according to their month of birth succeeded in the crucial initial ramp-up period of applications when the system was most at risk, resulting in the effective and expedited delivery of the benefit.

Using machine learning to identify offshore non-compliance

This project experimented with machine-learning methods and information extracted from the CRA’s historical data to develop new methods for assessing non-compliance related to offshore financial assets and income of T1 filers. The CRA’s modelling experimentations focused on various sampling strategies, decision tree models and model averaging techniques. This experimentation took historical data of high income earners with foreign income/assets to use within the CRA’s models to identify patterns associated with compliance and non-compliance behaviours. This proof of concept experimentation identified important factors needed to assess non-compliance risk.

Aligned to the central, transformative promise of the 2030 Agenda to leave no one behind and its sustainable development goals, the CRA works to ensure that vulnerable segments of the Canadian population (Indigenous peoples, newcomers and refugees, seniors, youth, persons with disabilities, housing insecure, and individuals with a modest income) receive the benefits and credits for which they are eligible.

The CRA contributes to Goal 1 by delivering benefit programs and tax credits for the federal government and most provincial and territorial governments. It also administers programs to help ensure that vulnerable Canadians have the information and support they need to access the benefits and credits to which they are entitled. For example, the following contribute directly to poverty reduction efforts:

• Canada Child Benefit ^{Footnote 38} (CCB) gives more money to families who need it most by providing tax free support to low and middle-income families to help with the cost of raising children
• Community Volunteer Income Tax Program ^{Footnote 39} (CVITP) works in collaboration with community organizations, supporting free volunteer-based tax preparation clinics for individuals with a modest income and simple tax situation. These clinics help eligible individuals file their tax returns to access the benefits and credits designed to support them. The CVITP works to reduce the barriers that prevent individuals from filing a return, including the cost of engaging tax preparation assistance, limited financial and technological literacy, the perception that filing is complicated, and not wanting to make an error on a tax return
• Northern Service Centres ^{Footnote 40} support individuals and businesses in the Yukon, Northwest Territories and Nunavut. In 2020–21, due to COVID-19, the Service Centre employees supported individuals and community organizations virtually by:
  • directing clients to free tax clinics
  • answering questions and distributing information related to benefits and credits individuals should receive
  • assisting clients with CRA communications (e.g., letters from the CRA), promoting and supporting the CVITP
  • helping clients access CRA’s digital services, including obtaining an access code for My Account, registering for My Account, and submitting documents online
• Residents of the Territories (with the 867 area code) can also call the dedicated individual and benefit enquiries or the business enquiries telephone line for access to agents who can assist with tax and benefit related questions. These dedicated phone lines connect residents with experts in northern tax issues
• File My Return service is a free, secure, and easy to use service that allows individuals with a low or fixed income to use an automated phone service to auto-file their income tax and benefit return. Recently, the CRA expanded the eligibility criteria to allow individuals with low amounts of employment or interest income to use the service. Each year, the CRA looks at ways to improve and enhance automated tax filing services for Canadians

The CRA contributes to Goal 16, through policies and practices that demonstrate a commitment to inclusiveness and transparency and accountability, including, for example:

• continuing its transformation journey to becoming a trusted, fair and helpful organization that places people at the center of everything it does
• contributing to the federal Open Government initiative and proactively releasing data and information, except that which must be withheld for privacy, confidentiality and security reasons
• leveraging clients’ feedback and insights to identify and better understand service challenges, and develop recommendations that will inform projects to improve their experiences when interacting with the CRA
• adopting the principles of privacy-by-design and upholding personal privacy rights in accordance with legislation and policy, including the management of internal privacy breaches

Social Responsibility

Through the CRA’s core business of tax and benefit administration it seeks to contribute to the economic and social well-being of Canada. In addition, the CRA supports initiatives that contribute to local communities and is committed to minimizing the environmental impact of its operations. The following are some of the social responsibility activities in which the CRA and its employees participated in 2020-21:

• promoting Mental Health Awareness Week (May 4 -10, 2020) to help celebrate, protect and promote mental health
• promoting the Bell Let’s Talk Campaign (January 4 - 28, 2021) to raise awareness and combat stigma surrounding mental illness in Canada
• partnering with organizations to recycle materials. Those organizations include Staples (writing instruments), Terracycle Canada (writing instruments, plastic cards, coffee pods), Computers for Schools (office supplies, electronics, electrical equipment), and Call2Recycle and Raw Materials Company (batteries)
• directly supporting a wide range of social, health, and community agencies and organizations—large and small—in communities across Canada through the CRA Charitable Campaign

The CRA integrates the TBR in its core responsibilities and across all of its daily activities. The TBR is a vital part of the CRA’s service transformation to be client-centric, fairer, and more supportive. These rights describe the treatment taxpayers are entitled to when dealing with the CRA. 

Rights 5 and 6, 9 to 11, and 13 to 15 (identified with an asterisk below) are service rights to govern the CRA’s relationship with taxpayers. A service right is influenced by general concepts such as fairness, transparency, and courtesy. The CRA’s service journey has promoted the widespread understanding of those rights to make sure they are integrated in how it delivers programs and services, and interacts with its clients.

1. You have the right to receive entitlements and to pay no more and no less than what is required by law
2. You have the right to service in both official languages
3. You have the right to privacy and confidentiality
4. You have the right to a formal review and a subsequent appeal
5. You have the right to be treated professionally, courteously, and fairly*
6. You have the right to complete, accurate, clear, and timely information*
7. You have the right, unless otherwise provided by law, not to pay income tax amounts in dispute before you have had an impartial review
8. You have the right to have the law applied consistently
9. You have the right to lodge a service complaint and to be provided with an explanation of the CRA findings*
10. You have the right to have the costs of compliance taken into account when administering tax legislation*
11. You have the right to expect the CRA to be accountable*
12. You have the right to relief from penalties and interest under tax legislation because of extraordinary circumstances
13. You have the right to expect the CRA to publish its service standards and report annually*
14. You have the right to expect the CRA to warn you about questionable tax schemes in a timely manner*
15. You have the right to be represented by a person of your choice*
16. You have the right to lodge a service complaint and request a formal review without fear of reprisal

Commitment to small business

1. The CRA is committed to administering the tax system in a way that minimizes the costs of compliance for small businesses
2. The CRA is committed to working with all governments to streamline service, minimize cost, and reduce the compliance burden
3. The CRA is committed to providing service offerings that meet the needs of small businesses
4. The CRA is committed to conducting outreach activities that help small businesses comply with the legislation we administer
5. The CRA is committed to explaining how we conduct our business with small businesses

Results

Providing a seamless service experience

The CRA is committed to service. Improving service to Canadians is a core priority. The CRA strives to always provide a positive experience, regardless of the nature of a client’s interaction with the CRA. Beyond its core mandate, the CRA’s work in recent years to transform itself into a client-centric, digital^{Footnote 41}  organization positioned it well to respond to the pandemic and support Canadians in 2020–21.

Although the CRA continued to work toward implementing planned measures to improve the client service experience, it did not fully achieve its 2020–21 commitments. Some initiatives were put on hold or delayed as resources were redirected to support COVID-19 relief measures.

In 2020–21, the CRA consulted with Canadians to better understand their needs and expectations, made it easier for them to interact with the CRA and targeted education and outreach activities to vulnerable populations. These activities helped to ensure that Canadians were aware of their benefit eligibility and reporting obligations.

In 2020–21, the CRA focused on the following objectives for this priority:

• provide its clients with access to easy-to-understand information
• interact with clients in ways that are integrated, tailored, digital and accessible, while leaving no one behind
• reduce the compliance burden of its clients

The following sections describe the CRA’s progress in achieving these objectives and meeting the commitments it made to Canadians in its plans for 2020–21.

Provide CRA clients with access to easy-to-understand information

Service improvements to the Disability Tax Credit

Service improvements implemented in 2020–21 include:

• a designated call line, with specially trained staff, to deal with more complex questions
• a "Navigator" role, launched in April 2021. Navigators approach each file with a People First philosophy to assist the client in navigating the Disability Tax Credit (DTC) application process to resolve issues or complaints within the structure of the Income Tax Act. The Navigator also aids in preventing these issues from re-occurring by working collaboratively with numerous stakeholders and by performing proactive internal activities to maintain the CRA service excellence and increase the public’s trust. The Navigator takes ownership of a DTC file and serves as a liaison between the CRA and the client or their authorized or legal representative
• a digital application of Form T2201—the Disability Tax Credit Certificate—to address the advisory committee recommendations on simplification, clarity and consistency. Testing is underway and the digital form is expected to be launched in 2021–22

The CRA also made progress in responding to the 10 recommendations of the 2020 Second Annual Report of the Disability Advisory Committee, focusing on the Registered Disability Savings Plan, concerns among Indigenous persons, life-sustaining therapies, disability supports deduction and work-related disability tax measures.

Lean principles were applied to enhance the Disability Tax Credit enhanced phone line. The workflow was mapped to visualize how complex calls are routed to the enhanced line which provided a common understanding of the process and insights into gaps that existed.

In 2020–21, the CRA:

• released educational webinars and updated content on Canada.ca to help businesses and employers understand the COVID-19 relief measures, and their Tax Year-End (TYE) filing obligations. For example in July 2020, the CRA published web content on Canada.ca on the 10% Temporary Wage Subsidy for Employers

• collected client feedback from a number of sources, including web analytics, social media and other communication channels, on the accessibility and usability of its online content. Priority content was usability tested with Canadians before launch to ensure it could be easily found, understood and had a high degree of task success. A usability analytics tool was also employed to help inform design decisions on how to improve the quality of online information. This tool was applied to the development of new content related to COVID-19 relief measures. It was also applied to three projects to make it easier to find and understand common questions about taxes and benefits on Canada.ca. These projects helped to mitigate the anticipated increased call centre volumes concerning a more complex 2020 tax filing season
• launched the "Be Scam Smart" advertising campaign to address the rise of tax and COVID-19 scams and help Canadians better identify potential scams and understand the CRA’s collection methods
• developed educational products, targeted to vulnerable segments of the Canadian population, on how to access the benefits and credits for which they are eligible, and their reporting obligations. These educational products included:
  • videos in 10 languages for newcomers that were distributed through social media, the CRA’s YouTube channel and Canada.ca
  • an outreach toolkit, developed in partnership with Indigenous Services Canada, to help build awareness and educate Indigenous peoples about emergency benefits as well as the Canada Child Benefit (CCB) and Goods and Services Tax Credit (GSTC)
  • expanded information on several CRA web portals, which minimized the administration burden and made it easier for clients to comply with reporting obligations 
• updated the Represent a Client online portal to allow clients’ representatives to update client information and provide estate documents, such as wills and death certificates electronically

• The Benefits Outreach Program continued to provide information to organizations and communities over the phone and via WebEx, rather than in person, to help individuals better understand their tax obligations and obtain the benefits and credits for which they may be eligible. In response to the ongoing COVID-19 pandemic, all Benefits Outreach Program activities for the 2020–21 year were conducted virtually. The Benefits Outreach Program conducted 3,431 virtual outreach activities, including 65 with Indigenous communities
• The Liaison Officer service continued to provide information to the small business and self-employed community over the phone and through videoconference, rather than in-person, to help them better understand their tax obligations and offer support and raise awareness on the federal government’s COVID-19 relief measures. In 2020–21, the Liaison Officer service:
  • contacted over 160,000 businesses
  • conducted 1,085 virtual visits
  • held 3 promotional events
  • held 502 virtual group seminars of which 372 were COVID-related
• The CRA continued to support community organizations and volunteers participating in the Community Volunteer Income Tax Program (CVITP) and the Income Tax Assistance program in Quebec to implement and host 427 virtual clinics to assist eligible clients file their income tax and benefit returns. In total, between May 16, 2020 and May 15, 2021, 582,420 individuals were helped through the CVITP ^{Footnote 42} 
• In accordance with its plan to help Canadians in the territories meet their tax obligations and receive benefits, the CRA expanded the Benefits Outreach Program, the CVITP and the CRA Liaison Officer service:
  • through the Benefit Outreach Program over 340 virtual outreach activities were conducted in the territories (Yukon, the Northwest Territories, and Nunavut), including virtual outreach to over 20 Indigenous communities. Additionally, for the period January 1, 2021 to April 3, 2021, there were approximately 40 CVITP organizations in the territories
  • through the Liaison Officer Program, 12 virtual visits were conducted and 60 seminars held, with 1,019 attendants
• The CRA launched the Individual Tax Filing Assistance Initiative (ITFAI) in July 2020 to complement the CVITP. CRA employees contacted taxpayers who had not filed their 2019 and/or 2020 tax return(s) and who may not have access to or be aware of the virtual CVITP services. Over 1,700 individuals were referred to a CVITP tax clinic by a CRA ITFAI agent. The initiative has helped lead to nearly 1,000 returns for the 2019 and 2020 tax year

Taking stock of the CRA’s commitments to Canadians

Interact with clients in ways that are integrated, tailored, digital and accessible, while leaving no one behind

The CRA is committed to engaging with its clients to obtain a better understanding of their needs and expectations to help inform service improvements. In 2020–21, it invested in technology and accelerated the use of digital solutions to improve access to information and services.

The CRA used research, usability testing, client insights and design thinking to identify challenges encountered by clients and to better understand their needs when accessing and using the CRA’s information and services. It leveraged clients’ feedback and insights to identify and develop tailored solutions to encourage clients to comply with reporting requirements.

The COVID-19 pandemic accelerated the implementation of key SR&ED transformation initiatives to contribute to enhancing a claimants’ overall experience with the SR&ED program, including:

• piloted a new virtual service with over 600 businesses
• providing tailored non-audit interventions such as service visits
• developed an enhanced online self-assessment and learning tool (eSALT) to help businesses understand whether their research and development work is eligible for the SR&ED tax incentives before they file a claim. This increases the likelihood that claimants will submit successful claims, if requirements are met, while reducing the administrative burden and processing delays

Consistent with its People First philosophy, the CRA has committed to the adoption of the client experience approach,^{Footnote 43}  a methodology to transform how it designs and delivers its programs and services. In implementing its client-centred approach, the CRA consulted diverse groups of employees across the organization to actively engage them in discussions on how the CRA can better serve its clients and to identify their learning needs in applying the client experience approach.

In March 2021, the CRA released foundational training material and published the first set of standardized client experience tools to give employees the ability to apply the client experience approach to projects and initiatives that involve or impact clients.

During 2020–21, CRA also conducted an Empathy in Service Awareness campaign to help employees learn about the importance of empathy to advance service as well as provide tools to enable employees be more empathetic.

The Government of Canada has indicated its support for the development of a strategy and roadmap to achieve a future-state seamless client service delivery model for the CRA. The 2020 Fall Economic Statement provided funding to develop the strategy and roadmap, which will advance the seamless client experience vision at the CRA. The CRA continues to implement the People First philosophy and the client experience approach to improve services for Canadians.

The CRA and other federal government departments, including Canadian Heritage and Employment and Social Development Canada, shared information related to Indigenous languages to better understand the whole-of-government priorities on the legislation, as well as further refine action plan items to support the implementation of the Indigenous Languages Act. Due to the pandemic, non-COVID related consultations with Indigenous communities were curtailed. Consultations planned for 2020–21 have been delayed to 2021–22.

Taking stock of the CRA’s commitments to Canadians

Reduce the compliance burden of the CRA’s clients

During 2020–21, the CRA:

• included an additional tax year to the Auto-fill my return service, which automatically fills in parts of an income tax and benefit return with information that the CRA has available at the time of filing the return
• reduced the compliance burden for compliant large business taxpayers by concentrating on high-risk high dollar audit adjustments and closing cases that are lower risk at an earlier stage
• created new forms, which were simpler and more streamlined, to support employers and Canadians working from home
• held interactive stakeholder sessions which reached nearly 5,000 participants from 3,800 organizations – including sessions to address unique public service pressures, to simplify the approach to claiming home office expenses
• helped businesses to comply by sending out approximately 7,000 letters to corporations that may have omitted a T2SCH50 Shareholder Information form from their 2018 and/or 2019 income tax returns or submitted an incomplete one. The letters helped to increase awareness of the importance of submitting accurate and complete schedules, and served as a request to provide or update missing or incorrect information
• started Canada Emergency Wage Subsidy audits before the end of the taxation year, an approach that provides taxpayers with earlier tax certainty
• collaborated with Revenu Québec on a working group which is focused on improving the customer experience, simplifying tax compliance and providing better digital services

Taking stock of the CRA’s commitments to Canadians

Maintaining fairness in Canada’s tax and benefits administration

The CRA applies the law equitably to maintain fairness in how it administers Canada’s tax and benefits system and to strengthen Canadians’ trust in the system. Non-compliance takes many forms: it may be the result of errors, a misunderstanding of rules or a lack of appropriate information. The CRA seeks to ensure that compliance is supported through education and outreach so that clients understand their obligations and claim the right benefits and credits. Understanding how and why taxpayers sometimes fail to comply is critical to preserving the fairness of Canada’s tax system.

Some clients intentionally try to avoid complying with Canada’s tax laws. In these circumstances, the CRA strives to identify and address intentional non-compliance to ensure that all clients pay their share. CRA adapts its intervention to the circumstances, while remaining professional, transparent and honest in the treatment of its clients.

The CRA engages its domestic and international partners to better understand and address areas of common concern and to achieve effective and fair tax administration across jurisdictions. In addition, the CRA uses various data sources and analytical approaches to maximize the ability to detect and deter the most serious instances of non-compliance, and take responsible compliance actions where necessary. It strives to ensure that non‑compliance is detected and addressed, using sound risk management to guide reviews, audits, criminal investigations and debt collection.

During 2020–21, the CRA reduced its core collection and compliance activities so that individuals and businesses could focus on the COVID-19 pandemic and not be faced with compliance efforts by the CRA. Similarly, collections efforts on new tax debt were suspended and flexible payment arrangements were made available to clients. As a result, the CRA did not achieve its commitment to resolve the remaining $1.9 billion in tax debt (of the original $7.4 billion over five years) committed to by the CRA as a result of Budget 2016 investments.

CRA resources were redirected to assist Canadians and businesses applying for Government of Canada emergency benefits and subsidies. The adaptability of the CRA’s collection and compliance resources was instrumental in its ability to address the increase in calls from taxpayers who required information on the emergency benefits, details on their files or assistance in reducing the financial burden of existing CRA actions. CRA employees verified and validated applicants’ eligibility to receive the emergency benefits and subsidies, including reviewing applications to identify and address fraudulent claims and cases of identity theft. The CRA deferred actions that could pose a burden on clients, including suspending collections activities on all debts, except for high-risk cases.

The fiscal impacts of the CRA’s business compliance and individual compliance activities were down by 88% and 43%, respectively, on a year-over-year basis. The work that was completed in core compliance programs focused on resolving cases where refunds were issued to taxpayers.

The CRA also focused on higher dollar audits first, audits close to completion and prioritized actions that were beneficial to the taxpayer or where taxpayers indicated an urgency to advancing their audit. Despite the redirection of resources, the fiscal impact from the CRA’s audit activities reached 95%, amounting to $12.1 billion, of the 2019–20 amount. Reviews were also completed to educate clients and assist them in meeting their T2 and GST/HST reporting and filing obligations.

Understandably, redirection of resources to assist in delivering the Government’s emergency measures impacted results for the CRA’s collection and compliance programs in 2020–2021:

• the tax debt, year over year (March 2021 vs March 2020), increased 10.5%, while the number of debtors increased 7.3%. Collections results at the Tax Service Offices and Debt Management Call Centres were down more than 16% in 2020–21 in comparison to 2019–20
• payment arrangements were expanded to allow for greater flexibility during unprecedented times

The CRA followed through on its commitments to further protect Canada’s tax base by:

• continuing to use data and business intelligence and advanced data analytics
• increasing its understanding of the compliance risks of emerging technologies
• collaborating with domestic and international tax administrations by sharing best practices, data and business intelligence, and working together on emerging tax avoidance and tax evasion issues
• addressing aggressive tax evasion and tax avoidance

During 2020–21, the CRA focused on the following objectives under this priority:

• enhancing its ability to detect and deter non-compliance
• strengthening collaboration with other tax administrations
• improving how it manages the tax debt

Enhancing the CRA’s ability to detect and deter non-compliance

The CRA directs its audit and investigation resources to the areas of highest risk to identify non-compliance. Wilful acts of non-compliance, such as failing to comply with tax obligations related to registering, filing and reporting, aggressive tax avoidance, tax evasion and tax fraud can place the integrity of Canada’s tax system at risk. Anti-avoidance rules and tax loopholes are systematically reviewed to ensure that everyone pays taxes in accordance with Canada’s tax laws.

In 2020–21, the CRA focused on developing better data and business intelligence and using more advanced analytics to improve its understanding of taxpayers and to better identify aggressively non-compliant taxpayers for audit. The CRA also worked to improve its knowledge and understanding of the compliance risks associated with new technologies and e-commerce.

The CRA increased its sources for data and business intelligence^{Footnote 44}  to improve its risk assessments and its ability to identify the most appropriate level of compliance intervention. In 2020–21, the CRA:

• developed tools to better identify small and medium enterprises (SME) that were avoiding their tax obligations, and to enhance its ability to understand the impacts of COVID-19 on SMEs so it can choose the appropriate interaction based on risk
• leveraged Common Reporting Standard (CRS)^{Footnote 45}  financial data received from partner jurisdictions to enhance automated, third-party data-matching and supplement its existing risk assessment processes
• improved data mining capabilities by adding more data sources to aid with in-depth compliance analysis
• shared data through exchange-of-information protocols with treaty partners and increased the use of third-party data through existing CRA tools, such as Unnamed Persons Requirements
• conducted a project for the review of algorithms by auditors to validate that they were appropriately identifying risks that warranted audit action
• increased the availability of real-time data, including text through machine learning, with a view towards targeting compliance actions to the appropriate level of intervention

The CRA expanded its capacity to gather information about non-compliant taxpayers by increasing its data-gathering, analytics, and investigations capacity by:

• establishing a data analytics research working group to focus on COVID-19 fraud related issues, share research projects, leverage data analytics, and develop tools and analysis to help identify non-compliance
• creating a business intelligence team to increase capacity for collecting information, analyzing data, identifying suspicious activities, and supporting criminal investigations. The business intelligence team allowed the CRA to identify significant benefit and subsidy fraud in a more timely fashion, using the latest tools
• completing revisions to the T1134 Information Return Relating to Controlled and Non-Controlled Foreign Affiliates to take into account the latest legislative amendments. The form design addresses both the CRA’s critical business needs and the tax community’s concerns on compliance burden by requiring a more comprehensive disclosure of transactions and events affecting the foreign affiliates while providing administrative convenience where appropriate

Non-compliance in the high net worth client (HNW) population remained a CRA priority throughout 2020–21. The CRA continued to work with international partners to exchange data to identify HNW individuals, including those who claim to be non-residents when CRA risk indicators appear to contradict these claims, who are avoiding paying domestic income tax. Under the Common Reporting Standard (CRS), Canada has activated exchange relationships with over 90 international partners to receive financial account information regarding Canadian tax residents that hold financial accounts offshore. In 2020–21, the CRA identified more than 110 new HNW individuals and their related entities and completed nearly 200 HNW audits of individuals and their related entities, such as corporations and trusts.

The CRA is committed to enhancing its understanding of digital tax compliance through jurisdictional research on emerging technologies and digital platforms, and developing strategies to identify and address non-compliance that involves the digital economy. During 2020–21, the CRA increased its knowledge of the compliance risks posed by new and emerging sectors of the digital economy, including cryptocurrencies. In 2020–21, the CRA:

• finalized its Platform Economy^{Footnote 46}  Compliance Strategy, which outlines the CRA’s vision to better use third-party data and other ways to improve how it detects and addresses GST/HST and income tax non-compliance within the digital economy
• continued to improve its understanding of the implications of cryptocurrencies on compliance and service to better position itself to respond to concerns about their potential use to evade taxes and aid in criminal behaviours

The CRA also:

• improved how it traces cryptocurrency transactions through the use of surveillance software to establish a comprehensive picture of a taxpayers’ cryptocurrency activities
• obtained an unnamed persons requirement on a large Canadian Cryptocurrency Exchange, the information from which will be used to verify compliance with the Income Tax Act (ITA) and/or Excise Tax Act (ETA)

The CRA continued to support the work of the Organisation for Economic Co-operation and Development (OECD) Forum on Tax Administration’s (FTA) Comparative Risk Assessment Initiative by examining how other tax administrations view and assess transfer pricing risks in areas that lead to the most disputes.

In 2020–21, the CRA:

• participated in forum discussions on transfer pricing dispute resolution and mechanisms for dispute prevention and resolution with respect to the OECD’s digital economy work
• provided input and best practices through the FTA Mutual Agreement Procedures (MAP) Forum and Working Party 6 (WP6). This contributed to the publication of the Guidance on the transfer pricing implications of the COVID-19 pandemic, in December 2020
• led efforts to streamline the process for developing advanced pricing agreements, for example, to give early tax certainty to compliant taxpayers

Taking stock of the CRA’s commitments to Canadians

Strengthening collaboration with other tax administrations

The CRA operates in a global environment, with an evolving international economy, increased business integration across borders, electronic commerce, new technologies and changing demographics, all of which present compliance challenges. In the context of the global economy, effective and fair tax administration is best achieved when countries collaborate so those who seek to avoid or evade their obligations have fewer opportunities to do so. International engagement helps ensure the integrity and fairness of Canada’s tax system and improve the efficiency and effectiveness of its administration.

During 2020–21, the CRA continued to engage with domestic and international tax administrations through a number of international forums to better understand compliance risks, share best practices, data and business intelligence, and to work together on emerging tax avoidance and tax evasion issues.

In 2020–21, the CRA:

• conducted research and consulted within Canada and with tax administrations in the United States, Australia, New Zealand and the United Kingdom to identify best practices in their administration of whistleblower programs and regulatory regimes. Research and consultations both confirmed that the CRA is at the forefront of paid whistleblower programs and highlighted the potential for the CRA to increase the protection of informants
• led efforts to strengthen tax administration capacity in developing countries through the OECD FTA, a forum chaired by the CRA Commissioner since August of 2020. Through this forum, the CRA continued to advance the FTA’s work on transparency, tax certainty, base erosion and profit shifting, and digital transformation
• developed a new version of the Knowledge Sharing Platform, a global online tool for tax administrations to encourage G20 countries and international tax organizations to share tax knowledge and expertise to enhance tax capacity-building efforts, particularly in developing countries. These upgrades increased the platform’s stability and information security, and provide support for future growth and enhanced features. Tax organizations from around the world have been leveraging the online platform to support their learning needs
• participated in the second phase of the International Compliance Assurance Programme (ICAP), a multilateral risk assessment and assurance process that uses country-by-country reporting and related information to facilitate multilateral engagements between multinational enterprise groups and participating tax administrations. The ICAP collaboration among tax administrators from the start of a risk assessment exercise helps to avoid potential time consuming and costly dispute resolution processes, and offers multinational enterprises and tax administrations a faster, clearer route to reduced tax risk

The CRA contributed to international cooperation and capacity building related to tax crime investigations by:

• working with tax enforcement authorities from Australia, the Netherlands, the United Kingdom, and the United States to formulate best practices to combat tax crimes through participation on the Joint Chiefs of Global Tax Enforcement. These authorities are focused on combating transnational tax crime and enablers of global tax evasion by sharing data, intelligence and technology
• contributing to initiatives of the OECD and the Financial Action Task Force (FATF) that are focused on combatting tax crimes, including tax evasion and money laundering
• contributing to Canada’s fourth follow-up report to the FATF, wherein Canada demonstrates the steps taken to enhance compliance with FATF recommendations and seeks re-ratings on various recommendations from Canada’s Mutual Evaluation Report. The FATF conducts in-depth peer reviews of each member country on an ongoing basis to assess levels of implementation of the FATF recommendations, providing an in-depth description and analysis of each country’s system for combatting money laundering and terrorist financing. Canada is seeking to obtain higher compliance ratings for the implementation and effectiveness of such measures

The CRA led the Joint International Taskforce on Shared Intelligence and Collaboration (JITSIC) project on HNW individuals. In addition, the CRA developed and delivered a presentation to the JITSIC Network with the United Kingdom on HNW identification, risk assessment, and residency issues.

Canada was an active contributor to the OECD base erosion and profit shifting (BEPS) project, including participation from the CRA. The OECD work addresses the problem of certain multinational enterprises (MNEs) and individuals inappropriately shifting profits between jurisdictions and using other international tax avoidance schemes. Among other initiatives, the project advocated for stronger mandatory disclosure rules and spontaneous exchange of tax rulings of interest to other jurisdictions which presented potential BEPS risks. In 2020–21 the BEPS action plans were leveraged and with the support of the CRA, public consultations on proposals to enhance Canada’s income tax mandatory disclosure rules were launched with Budget 2021. The CRA also, as part of the BEPS project, continues to receive and exchange tax rulings, to enhance the evaluation of tax risks present in the structures and arrangements of multinationals present in Canada. Canada and the CRA have continued the collaboration started with the BEPS project through the OECD’s subsequent work to address the digitalization of the economy. This work centres on two pillars to usher in a new regime for the taxation of multinationals and is progressing with the support of the G20 and OECD. The CRA participated via various OECD working parties as well as through other fora.

In 2020–21, the CRA worked with other tax administrations to respond to emerging tax avoidance and evasion issues in the Canadian context. For example, the CRA continues to actively collaborate with Revenu Québec to address offshore tax risks. The CRA increased the sharing of information, partnered with Revenu Québec on a number of joint compliance projects, and continued to intensify its efforts in the area of transfer pricing, collections, and aggressive tax planning.

Taking stock of the CRA’s commitments to Canadians

Improving how the CRA manages the tax debt

The CRA collects tax debts, as well as other types of government debt, assessed through federal, provincial and territorial laws. Collecting outstanding tax owing and other debts is critical to protecting Canada’s tax base and providing governments across Canada with the revenue needed to support the Government of Canada’s programs and priorities.

In 2020–21, the CRA continued to evolve its collections strategies to more effectively enforce Canada’s tax laws to help ensure that every taxpayer pays their fair share. The CRA implemented several pilot projects to gather business intelligence to develop more efficient collection processes. The CRA has developed specialized groups of collectors to assist segments of the population with particular service needs, and used taxpayer history to determine the most likely collection action to resolve accounts as quickly as possible. Furthermore, two initiatives are in progress to improve the assignment of accounts to collectors. One initiative aims to develop program business rules to assign the "right account, to the right officer, at the right time." The other segments and assigns accounts with common characteristics to groups of collectors with specific expertise to provide consistent resolutions and improve services.

The CRA strives to help clients who owe it money. To support and educate clients, the CRA updated its online content outlining the services available to those who owe money and provided detailed step-by-step instructions on making payment arrangements. 

In 2020–21, to improve the effectiveness of the CRA’s Debt Management Call Centres, the CRA used client feedback to develop a new service standard, which took effect April 1, 2021. This is a timeliness service standard for tax and government programs collections payment arrangements, and enquiries from businesses and individuals. The standard is to respond to each call within five minutes or less once the caller opts to speak to an agent. The CRA’s target is to meet this service standard 90% of the time. This standard supports the CRA’s efforts to assist taxpayers in meeting their payment obligations by ensuring they are served in a timely manner when contacting the Debt Management Call Centre.

Taking stock of the CRA’s commitments to Canadians

Strengthening trust, transparency and accountability

Maintaining public confidence in the integrity of the tax system is of paramount importance to the CRA. As one of the largest holders of personal information in the Government of Canada, Canadians place their trust in the CRA to protect their information from unauthorized access or disclosure. This trust inspires positive compliance behaviours that contribute to protecting Canada’s revenue base. To keep this trust the CRA treats privacy and security as critical aspects of its business, from fostering a culture of integrity to leveraging systems and tools to prevent, monitor, detect and manage potential incidents.

The CRA operates in an environment of increasing threats to the security of personal and financial information. Furthermore, in 2020–21 COVID-19 posed additional risks to the health, safety and security of the CRA’s workforce, and to the protection of taxpayer information. The CRA responded quickly by issuing a work from home directive in accordance with public health guidance and establishing safety protocols to reduce employees’ risk of exposure. It also issued temporary exemptions to some security requirements so that it could continue to deliver critical services, while assuring that controls for the protection of taxpayer information remained in place and that risk could be managed.

In 2020–21, the CRA continued to strengthen security and privacy by increasing awareness among employees of their responsibilities and enhancing its technologies, processes and controls to protect sensitive information from internal and external threats. For example, it implemented additional authentication measures with a two factor authentication for CRA internal users and external partners accessing the CRA’s internal systems. This serves as an extra layer of security by requiring users to provide a unique piece of identification in addition to a user-id and password. The CRA also adopted the principles of privacy by design and strengthened its Privacy Management Framework.

The CRA also furthered trust by being transparent and accountable about the measures it takes to protect personal information, and by informing Canadians about the level of service they can expect to receive. In 2020–21, the CRA further demonstrated its commitment to increased transparency and accountability by proactively releasing COVID-19-related data and information on the Open Government Portal. As part of its accountability to Canadians, the CRA reported on emerging tax evasion and fraud schemes, its progress on implementing recommendations from the 2019 Disability Advisory Committee annual report, and its progress in promoting sustainable development.

In 2020–21, the CRA fulfilled all but one of its commitments for the strengthen trust, transparency and accountability priority. However, it experienced a delay in publishing the results of its Client Experience Index, a metric of how clients perceive their experiences with the CRA.

In 2020–21, the CRA focused on the following objectives related to this priority:

• strengthening its security posture
• proactively responding to clients’ privacy concerns
• increasing transparency
• promoting sustainable development

The following sections describe the progress the CRA has made on achieving these objectives and its commitments to Canadians in its plans for 2020–21.

Strengthening the CRA’s security posture

In 2020–21, the CRA continued to invest in security awareness training and in modernizing processes to prevent, monitor, detect, and manage potential threats to the security of employee and taxpayer personal and financial information.

Identity theft and account security are becoming a larger global issue. Institutions in both the private and public sectors are being targeted with malicious attacks and attempts at infiltration. The CRA has become an increasingly attractive target since the pandemic began, given our key role in administering COVID-19 economic relief programs. By offering Canadians greater digital service options to deal with the CRA at the time and place of their choosing, the CRA’s systems are housing, processing and transmitting growing volumes of sensitive personal information.

In the summer of 2020, the CRA and the Government of Canada experienced cyber incidents. In those incidents, stolen credentials were obtained through a variety of means from sources external to the CRA. The CRA rapidly countered these attacks to uphold the integrity and security of taxpayer information and accounts.

In today’s increasingly digital world, organizations must constantly take steps to safeguard sensitive information against constantly evolving threats. In late 2020, the CRA elevated the Agency Security Officer role to become a Deputy Assistant Commissioner. The Agency Security Officer is responsible for the overall CRA Security Program, including cybersecurity, account security, and physical security, among other functions.

The protection of taxpayer information is of the utmost importance for the CRA. This is why we have stringent and ongoing measures in place to analyze, identify and mitigate against potential threats and to neutralize threats when they occur. The CRA also leverages its relationships with other government departments, law enforcement, the Canadian Anti-Fraud Center and the provinces and territories to ensure horizontal collaboration and coordination needed to protect taxpayer accounts and personal information.

To help employees understand their security responsibilities, the CRA:

• implemented security awareness campaigns on working remotely, fraud prevention, business continuity management, cybersecurity and categorization of information
• made resources available on the internal website that detailed security considerations while working remotely, and provided support and guidance in response to the COVID-19 pandemic
• initiated analysis and development of national learning paths for various security positions

The CRA increased monitoring and introduced enhanced controls to prevent, detect and manage potential threats to its personal information holdings. In 2020–21, the CRA:

• completed the Protection of Personal Information Vulnerability Review, taking into account the potential impact of COVID-19, to identify and understand potential weaknesses in the processes and procedures for the protection of personal information. The review identified opportunities to strengthen controls around the protection of personal information, including the mandatory use of security categorizations on documents and emails
• completed Phase 1 of the Data Security Initiative which enhanced security controls around how sensitive information is stored, used and transmitted over the network
• enhanced its monitoring of information leaving the CRA in electronic format. Examples of improvements include the mandatory use of security categorizations on documents and emails and enforced encryption for all removable devices. These controls strengthen the CRA’s cyber-security defenses and better protect client data from unauthorized access, alteration or loss
• implemented new and updated fraud detection models to better detect potentially fraudulent employee transactions and the misuse of information. This included expanding the Enterprise Fraud Management Solution network to capture and monitor employees actions when answering enquires about individual or business accounts

Taking stock of the CRA’s commitments to Canadians

Proactively responding to clients’ privacy concerns

Safeguarding the privacy of Canadian’s personal information and effectively managing privacy breaches is critical for maintaining public confidence in the integrity of the tax system. In 2020–21, the CRA continued to manage privacy rights and internal privacy breaches, and increased awareness within the CRA of the importance of privacy for its clients.

In 2020–21, the CRA:

• continued to uphold personal privacy rights in accordance with legislation and policy, including the management of internal privacy breaches. More specifically, the CRA:
  • ensured privacy implications were considered as part of privacy assessment processes, and as a result, three privacy assessments were completed during the fiscal year
  • responded to 4,023 Privacy Act requests while ensuring that information was protected in accordance with legislation
  • developed privacy breach procedures and worked with key CRA stakeholders to effectively manage breaches as soon as they occurred
  • reported five material breaches to the Treasury Board Secretariat and the Office of the Privacy Commissioner
• adopted the principles of privacy by design. Going forward, privacy considerations will be incorporated by default into the development, operation and management of all programs, processes, solutions and technologies involving personal information
• strengthened privacy governance in July 2020 by establishing a Privacy Council that meets quarterly and is chaired by the Chief Privacy Officer. The Council’s mandate is to facilitate a horizontal approach to privacy governance, identify privacy risks and outline mitigation strategies for the CRA. The Council met twice during 2020–21
• completed its five-year review of privacy-related corporate policy instruments leading to a strengthened Privacy Management Framework with the launch in March 2021 of updates to corporate policy instruments, enhanced procedures to effectively manage privacy breaches, and updates to the Privacy Practices Toolkit to incorporate new policies and procedures
• To increase awareness about the importance of privacy for its clients, the CRA:
  • enhanced the CRA-wide privacy and access to information training and awareness strategy
  • participated in a Data Privacy Day presentation by the Canada Research Chair in Internet and E-commerce Law at the University of Ottawa, with over 4,000 CRA employees attending the event
  • provided training to employees in the International Association of Privacy Professionals’ in preparation for the information privacy manager certification

Taking stock of the CRA’s commitments to Canadians

Increasing transparency

In 2020–21, the CRA continued to demonstrate its commitment to increased transparency and accountability, by contributing to the federal Open Government initiative and proactively releasing data and information, except that which must be withheld for privacy, confidentiality and security reasons. In April 2020, the Government of Canada committed to proactively releasing COVID-19-related data and information on the Open Government Portal.

The CRA responded quickly to support the transparency and accountability of the Government’s COVID-19 emergency measures by releasing high-value emergency data, providing information to the public, and engaging with the public and stakeholders when delivering emergency benefits and subsidies. Specifically, the CRA:

• released the Canada Emergency Wage Subsidy (CEWS) and the Canada Emergency Student Benefit (CESB) datasets on the Open Government Portal
• posted information and statistics on a suite of COVID-19 recovery benefits and subsidies on Canada.ca, including the Canada Recovery Benefit (CRB), Canada Recovery Sickness Benefit (CRSB), Canada Recovery Caregiving Benefit (CRCB) and the Canada Emergency Rent Subsidy (CERS)
• expanded the accountability of the CEWS subsidy by creating the CEWS Registry, allowing the search for employers that received or will receive the CEWS

The CRA collaborated with Employment and Social Development Canada (ESDC) to contribute to their release of Canada Emergency Response Benefit (CERB) datasets. The release combined the CRA’s components administered by both organizations. It also participated in federal interdepartmental working groups to help with the coordinated public release of data and information related to CERB.

In accordance with its plans, in 2020–21 the CRA demonstrated its commitment to transparency and accountability and posted a revised Privacy Notice on Canada.ca describing CRA’s privacy responsibilities and practices to help Canadians learn more about what the CRA is doing to protect their sensitive personal information and privacy. It also posted service standards, performance targets and results on Canada.ca to inform Canadians of the level of service they can expect and the extent to which the CRA has achieved these standards.

The CRA increased the efficiency of its review and consultation process for corporate policy instruments to help ensure that they are up-to-date so that employees have the direction they need to do their jobs while supporting the CRA’s accountabilities. It instituted a quarterly process to improve the monitoring of the status of corporate policy instrument reviews. This process enables the CRA to identify, well in advance, corporate policy instruments that are due for review and update.

During 2020–21, the CRA continued to inform Canadians, through its website and through national and/or regional newswires and the CRA electronic mailing lists, about emerging tax evasion and tax fraud schemes. The CRA publicized 21 enforcement notifications, and 86% of the enforcement notifications were posted on the CRA website within a week of the enforcement action. By publicizing enforcement actions in a timely manner, the CRA raises public awareness and understanding of compliance actions and results, and of the risks and consequences of non-compliance.

To process criminal investigation cases more quickly, the CRA modernized its software and hardware at the Digital Imaging Centre in Prince Edward Island to be able to scan large amounts of seized documents in a more thorough and timely fashion. By accelerating the processing of documents for disclosure to the Public Prosecution Service of Canada, the CRA helps to ensure that the accused are tried within a reasonable timeframe. It also obtained a new disclosure tool which provides greater search capability within disclosure packages.

Taking stock of the CRA’s commitments to Canadians

Promoting sustainable development

The CRA’s actions in response to the United Nations’ 2030 Agenda for Sustainable Development and the United Nations’ Sustainable Development goals are described in the Departmental Sustainable Development Strategy 2020 to 2023 ^{Footnote 47} .

Taking stock of the CRA’s commitments to Canadians

Enabling innovation

The CRA is committed to a culture of innovation, experimentation and intelligent risk taking. Innovation at the CRA is about continuously improving the way services are provided to Canadians by generating new ideas, improving processes, developing new technology and finding efficient service approaches to adapt to current challenges and changing circumstances.

• build evidence for an idea before full-scale implementation
• enable the CRA to explore ideas and run experiments to see what works in the CRA context
• change the CRA’s culture so that changes can happen anywhere in the organization

In 2020–21, innovation at the CRA was accelerated to effectively respond to the COVID-19 pandemic. The CRA made significant advancements, especially in digital services, behavioural insights, advanced analytics and new information technologies. The CRA aligned work on innovation, service and digital to reduce silos and encouraged service-driven and innovative approaches to transformation projects.

Although the CRA did make progress on its commitment to experiment with machine learning models to improve service to clients and the detection of non-compliance, completion of the two pilots using machine learning models were delayed.

While the CRA explored and exploited opportunities for innovation, it also continued to apply the Lean Methodology, the client-experience approach and other client-centric approaches to support transformation and continuous improvement in the delivery of its programs and services.

In 2020–21, the CRA focused on the following objectives related to this priority:

• fostering innovative mindsets and approaches
• enhancing its operations through continuous improvement
• exploring innovative technologies and analytical methods

The following sections describe the progress the CRA made on achieving these objectives and its commitments to Canadians in its plans for 2020–21.

Foster innovative mindsets and approaches

In 2020–21, the CRA fostered an environment where employees at all levels think critically about how they do their work, learn from each other, leverage lessons learned from past experiences and embrace challenges and setbacks with creativity and imagination. In the 2020 Public Service Employee Survey 71% of the CRA employees indicated that they were encouraged to be innovative or to take initiative in their work. Sixty-nine percent indicated that they felt that they would be supported if they proposed a new idea. To continue to improve on these results, the CRA took a number of steps to engage employees more broadly to evolve innovation in the CRA and invest in new ideas.

In 2020–21, the CRA introduced opportunities for employees to learn from each other with the goal to increase intelligent risk taking and learning from past mistakes. To do this, the CRA:

• held the first CRA Innovation Conference for CRA employees – Investing in our Future. CRA employees benefitted from hearing about innovation perspectives from leaders in the innovation community both from within the CRA and externally. The virtual conference had almost 800 attendees from 73 different cities across the country
• highlighted innovative people and activities through showcases and spotlights on CRA employees on the internal website, two of which have received the highest traffic visits of any career spotlights posted on the website

The CRA fostered collaborative relationships and partnerships with other Government of Canada departments, other levels of government, academia and the private sector to enable two-way learning and sharing of innovative approaches on common issues. As a recognized leader in the artificial intelligence (AI) governance space within the Government of Canada, the CRA provided feedback, guidance and lessons learned to other Government of Canada and provincial departments, including Transport Canada, the Canada Border Services Agency (CBSA) and the Government of British Columbia.

As a member of the Tax Gap community of practice of the OECD, the CRA engaged with international colleagues in the development of the methodologies adopted for the Excise Tax Gap report.

Taking stock of the CRA’s commitments to Canadians

Enhance CRA operations through continuous improvement

In 2020–21, the CRA continued to foster a culture of continuous improvement across the organization, including the use of the Lean methodology^{Footnote 49}  to generate recommendations to improve business processes and procedures.

The CRA applied the Lean principles to several business areas with a goal to improve service delivery by streamlining business processes and procedures, and identifying gaps and areas for improvement. For example, Lean principles were applied to the Business Enquiries Contact Centres process to develop and update procedures for employees. Improvements were identified and are being implemented, and early indications show they are having positive impacts on the process effectiveness and employee satisfaction.

Taking stock of the CRA’s commitments to Canadians

Explore innovative technologies and analytical methods

The CRA recognizes the importance of innovative technologies and how they can help to transform the way in which it delivers its programs and services and how it communicates with Canadians. 

The CRA appointed the first Digital Transformation Officer to lead the digital transformation and implementation of a comprehensive, integrated approach to digitalization to help the CRA to become a truly digital tax and benefits administration. In October 2020, the CRA launched the Digital Business Strategy 2020–2022 – a major milestone to advancing digital initiatives and providing better services to Canadians, and the Digital Implementation Plan in March 2021. In addition, the Digital Acceleration Fund was established in 2020 with an envelope of $10 million over two years to allow the CRA to advance digital initiatives in an expedited manner, with a focus on reducing reliance on paper, modernizing various processes, and supporting research and experimentation.

• launched the Directive on Artificial Intelligence and the Algorithmic Impact and Alignment Assessment (AIAA) tool. The Directive sets out the governance for AI and sets out roles and responsibilities to help ensure the responsible use of AI. The AIAA is a mandatory tool that serves as a central repository of all AI projects at the CRA, and which guides employees through assessments of their project’s alignment with business priorities and risk and mitigation strategies, including ethical considerations, during the development and production phases
• established the Emerging Technology Framework to support decentralized ideation and experimentation while providing centralized peer review, oversight and reporting to ensure that resources (human and financial) are applied according to priorities
• established an oversight structure for information technology research and experimentation which includes a horizontal peer review and recommendation body, the Emerging Technology Ambassador Innovation Council, and the Emerging Technology Innovation Board
• created the Emerging Technology Registry, a centralized source of information about emerging technology research and exploration, which supports development of the Emerging Technology Radar which is a point in time graphical depiction of all the technologies and trends being researched and the statuses of activities. This facilitates ongoing communications and monitoring of progress on plans and commitments
• continued to advance the third generation – Application Development Platform to provide CRA software engineers and developers with enhanced expertise, tools and processes, thereby enabling them to efficiently build better, secure digital solutions that can be delivered incrementally

The CRA conducted pilots to experiment with machine learning to detect non-compliance and increase the efficiency of internal operations, including a project aimed at detecting non-compliance related to offshore financial assets of T1 filers. Another project was aimed at promoting greater horizontality for data use to generate synthetic data to replace real data, for use in processing, analysis, model building and data imputations.

Taking stock of the CRA’s commitments to Canadians

Empowering the CRA’s people to excel

The CRA is committed to providing its employees with a healthy and empowering work environment and giving them the support they need to strengthen its service culture.

In 2020–21, COVID-19 restrictions not only changed the way programs and services were delivered to Canadians, but had a significant impact on how employees went about their daily work. The work from home directive meant that employees interacted virtually with their clients and each other, and accessed services, such as learning opportunities, virtually. The CRA continued to demonstrate its People First philosophy by providing employees with the tools and resources to help them transition to the new work environment. It also increased its focus on the physical and psychological well-being of its employees.

During 2020–21, the CRA empowered its people to excel by continuing to advance its plans to promote a safe and healthy workplace free from harassment, violence and discrimination. Furthermore, it continued to foster a culture of continuous learning and provided the training, tools and resources to enable employees to apply the People First philosophy in their interactions with clients and each other. The CRA continued to direct recruitment efforts to build a diverse workforce and recruit people with the required skillsets.

The CRA did not complete two commitments by the targeted delivery date under this priority. The first was a commitment for the national launch of the mobility bank. The initial testing phase was extended to ensure that the mobility bank was functioning as intended before proceeding to a national launch. The second commitment, to implement a comprehensive action plan to respond to regulatory requirements that expand the definition of violence to include harassment, was delayed as resources were redirected to the CRA’s COVID-19 response.

In 2020–21 the CRA focused on the following objectives related to this priority:

• addressing current and future workforce transformation needs
• supporting safety, respect, well-being, diversity and inclusion

The following sections describe the progress the CRA made on achieving these objectives and its commitments to Canadians in its plans for 2020–21.

Addressing current and future workforce transformation needs

The CRA is committed to ensuring that it provides employees with a safe and healthy work environment, one which fosters a culture of learning, and to recruiting the talent it needs to support its transformation.

In 2020–21, the CRA:

• implemented a National Business Resumption Plan. Consistent with its People First philosophy, the plan provided a framework for the CRA to resume its activities in a way that supported the continuing and changing needs of its employees and clients
• made tools and resources available to managers and employees to support their physical and psychological well-being. The CRA conducted surveys and managers had regular check-ins with employees to gather feedback on the impact of COVID-19 on their work. As a result, the CRA introduced additional measures to address health and safety issues:
  • established the Learning and Well-being COVID-19 Working Group in May 2020, which developed an Employee Toolkit to provide information and resources on how to safely work on-site with COVID-19 restrictions
  • introduced a mandatory tool to track and monitor the number of employees who tested positive for COVID-19, were exhibiting symptoms of COVID-19, who were asked to self-isolate or who initiated a work refusal due to the risk of COVID-19
  • published a "Health and Safety Checklist" and a list of "Ergonomic Principles" in April 2020 to support employees as they performed their duties from home
  • developed tools and resources to support manager and employee well-being, including: Self-Care tips for managers and their teams during the COVID-19 pandemic; Contributing to a Harmonious Virtual Work Environment; and Communication Strategies for Virtual Teams

The CRA also continued to implement initiatives on its Healthy and Safe Workplace Action Plan. All but two of the 28 action items are in progress or completed. The two outstanding items are linked to changes to the Canada Labour Code and regulations and have dependencies on external stakeholders.

In 2020–21, the CRA continued to implement the character leadership model within the CRA. It trained executive-level board members from the CRA, as well as other government departments, on the character leadership model and interview process and applied the model to EX-01 and EX-02 staffing processes. As a recognized leader in the implementation of character leadership, the CRA assisted the Royal Canadian Mounted Police, Canada Border Services Agency, Financial Transactions and Reports Analysis Centre of Canada, and the Public Prosecution Service of Canada to implement their character leadership programs.

The CRA is committed to a culture that fosters continuous learning, which prioritizes learning to build the knowledge and skills to support its evolution to a culture of service. In 2020–21, the CRA continued to provide employees with the tools, resources and training to help them build and maintain the skills and competencies to support their career development and to adopt the CRA service culture. To support online learning, the CRA developed a virtual facilitation toolkit for the virtual training community and an internal train-the-trainer session for virtual facilitators.

In accordance with its 2020–21 plans, the CRA:

• provided training on empathy in client service, and published the first set of standardized client experience tools, including templates for creating personas and journey maps
• continued to implement the learning activities that were embedded in the CRA’s Workforce Plan 2019–2020 to 2021–2022
• launched a new virtual orientation program that was delivered to 260 new employees
• continued to identify and address recruitment gaps and enhance talent acquisition through targeted virtual recruitment activities to attract people to meet operational needs. Recruitment targeted the areas of information technology, data science, and accounting

While there were fewer traditional recruitment outreach events in 2020–21, advancements in virtual hiring and the shift to virtual engagement, enabled the CRA to connect with target candidates and to proactively create recruitment outreach channels. The CRA strengthened partnerships with post-secondary institutions and participated in 91 virtual recruitment activities at post-secondary institutions; and also held two virtual CRA Career-Days.

In 2020–21, the CRA developed the CRA Employment Equity, Diversity and Inclusion Action Plan 2021 to 2022 through 2024 to 2025 as a result of a CRA-wide consultation process to gain perspective about diversity, inclusion, and racism at the CRA. The CRA also developed tools to raise awareness about diversity and inclusion including:

• an unconscious bias workshop for employees
• an Ally Guide and a Diversity and Inclusion Lens Handbook
• guidelines on why, when and how to acknowledge Indigenous peoples’ lands during meetings and events

The CRA continued to diversify its workforce by considering diversity and inclusion in recruitment and staffing practices. The CRA:

• implemented mandatory training on unconscious bias for members of Executive Group and Management Group staffing boards
• provided hiring managers with more timely information about employment equity gaps in their area so they can make better informed hiring decisions.
• launched a leadership learning initiative to increase leadership capacity for high-potential employees in management feeder group positions. Fifty percent of the seats are reserved for three of the four employment equity groups: Indigenous peoples, visible minorities and persons with disabilities
• conducted an EX-01 targeted selection process for visible minority groups and Indigenous peoples, resulting in 861 applicants and 30 qualified candidates
• developed a comprehensive strategy for the recruitment, inclusion, and retention of persons with disabilities
• launched a new recruitment identity in the winter 2021 to better convey the CRA’s commitment to a diverse and representative workforce. The new recruitment identity aims to better showcase the CRA as a diverse and inclusive employer and organization. Testimonials from CRA employees, sharing their stories of why they enjoy working for the CRA, highlight the diverse range of careers that the CRA offers, and the benefits of a career with the CRA. The new identity supports the CRA’s vision – to be trusted, fair and helpful by putting people first
• supported the government’s reconciliation mandate by implementing a strategy for the recruitment, inclusion and retention of Indigenous Peoples. The result has been an increase in the representation of Indigenous Peoples in professional positions. The CRA continues to promote the Indigenous Student Employment Program (ISEP) as well as the Employment Opportunity for Students with Disabilities program. One of the impacts of COVID-19 was fewer recruitment events and a reduction of hires from the IESP

Taking stock of the CRA’s commitments to Canadians

Supporting safety, respect, well-being, diversity and inclusion

The CRA strives to create healthy workplaces by interacting with civility and respect by minimizing harassment, discrimination and violence; supporting employees’ physical and psychological well-being; embracing diversity and inclusiveness; and making efforts to ensure people feel heard and valued. By promoting respectful behaviour, the CRA supports the well-being of all its employees.

In the spring of 2021, the CRA completed the implementation of the third and final phase of the 2016 to 2019 Respectful Workplace and Well-being Strategy and approved a new Well-being Strategy for 2020 to 2023. The new strategy has four well-being goals: support employees; strengthen leadership; foster healthy workplace interactions; and secure the foundation.

These goals align closely with the Public Service Workplace Mental Health Strategy by ensuring that employee mental health is supported and respected. To support this strategy, the CRA:

• developed tools to support a dialogue about well-being in the workplace, including "Preparing the Workforce: Well-being Worksite Checklist." The checklist provides guidance for managers on how to talk to employees who request to return to CRA worksites for reasons related to mental health and well-being
• increased capacity and improved processes and tools to respond to changes to the Canada Labour Code (Bill C-65) and updates to the Workplace Harassment and Violence Prevention Regulations which came into effect on January 1, 2021

To support the changes, the CRA:

• reviewed its service delivery model and identified a new classified structure to provide dedicated resources to respond to changes to the Canada Labour Code and associated regulations
• improved processing timeliness, and developed tools to address challenges including a grievance checklist to ensure sufficiently detailed information is collected at grievance hearings where allegations of discrimination and/or harassment have been submitted
• formalized an interim process for the exchange of information and vetting of investigation reports on discipline, harassment, discrimination or workplace violence
• completed a five-year review of the Code of Integrity and Professional Conduct, and updated its Corporate Policy Instruments, and supporting tools, to align with the new regulations. The Directive on Conflict of Interest was approved on April 1, 2021

Taking stock of the CRA’s commitments to Canadians

Board of Management results

Strategic direction

For the 2020–21 fiscal year, the Board and the CRA focused on its five joint strategic priorities of: providing a seamless service experience; maintaining fairness in Canada’s tax and benefits administration; strengthening trust, transparency, and accountability; enabling innovation; and empowering the CRA’s employees to excel. During the past year, the CRA’s People First philosophy has been the guiding principle behind its day-to-day operations including the welfare and well-being of its employees.

Providing a seamless service experience

The CRA successfully delivered various emergency relief benefits to Canadians during the pandemic, on behalf of the Government of Canada. This was done while ensuring the safety and well-being of its employees and providing them with the necessary tools to continue to serve Canadians.

Through its Service Transformation Subcommittee (STS), the Board continued to oversee the CRA’s services and associated risks and provided strategic direction and advice on service transformation. The STS reviewed and provided feedback on:

• various quarterly reports on the CRA’s call centres, which included information on the quality and the quantity of calls handled by call centre agents
• reports from the CRA’s Chief Service Officer on the external service standards and how they were being impacted by the pandemic
• the CRA’s transition from a business continuity to a business resumption mode

Although the Board established the STS on a temporary basis to oversee the CRA’s service transformation initiative, it continued the subcommittee to oversee CRA efforts to provide clients with seamless and empathetic service during the pandemic, and to guide the CRA’s service transformation strategy.

The Board encouraged and provided oversight and direction for the CRA’s efforts to move towards digitalization. The CRA created a digital transformation officer position in July 2020 to lead the digital transformation. To this end, the Board approved the CRA’s Digital Business Strategy through which the CRA will invest $10 million over two years to support and accelerate digital initiatives across the organization. One example of the result of digitalization is that, during the pandemic, the CRA was able to virtually offer the Community Volunteer Income Tax Program to the most vulnerable people in Canadian society.

Under the Board’s oversight of major projects, the CRA completed and delivered a more robust benefits system. This will improve CRA’s capacity for benefit program growth and service delivery.

The Board requested regular updates on the status of programs that were temporarily paused due to the pandemic. This pause created an inventory backlog in some programs. The Board, in partnership with the CRA management, continued to monitor the CRA’s action plans on inventory reductions and the return to pre-pandemic service targets.

The cyber incidents in the summer of 2020 adversely affected the CRA’s abilities to serve some Canadians and the Board stayed abreast of CRA’s efforts to mitigate and resolve this situation, so that Canadians continue to trust the CRA with their information.

Maintaining fairness in Canada’s tax and benefits administration

The Board oversaw and supported the CRA’s efforts to maintain fairness in Canada’s tax system through its oversight of CRA services and compliance efforts. The Board continued its compliance and collection activities in high risk sectors during the pandemic and took action against those not complying with Canada’s tax laws.

To lessen the growth of tax debt, the Board continued to encourage the CRA to develop new debt collection strategies and processes with the use of business intelligence. The Board engaged in discussions with the Commissioner and other senior CRA executives to explore the efforts underway to combat tax avoidance and tax evasion.

The Board was informed on the CRA’s engagement with other tax administrations and international organizations and their efforts to combat cross-border tax evasion. The Commissioner, in his role as the Chair of the Forum on Tax Administration (FTA) at the Organization for Economic Co-operation and Development’s (OECD), played a key role in engaging in international taxation matters with his counterparts, strengthening the CRA’s relationships with international tax administrations. The Commissioner apprised the Board of his work, which helps develop international tax standards, promotes collaboration amongst tax administrations to deter non-compliance, and fosters exchange of best practices.

Strengthening trust, transparency, and accountability and security

In 2020–21, the Board oversaw CRA’s continued efforts to improve data quality and better integrate data across the CRA. It approved the information and data strategy and action plan.

The Board received a report on the vulnerability of personal information and the protection measures in place, or being enhanced, to safeguard the information held in CRA systems. It will also oversee the implementation of all the report recommendations. The CRA continued to enhance procedures to respond to privacy breaches, improve internal privacy policy instruments and tools, and develop an performance measurement framework for organizational privacy management.

The Board guided the development of the Guardian Program which will enhance continuous assurance from an insider-threat perspective. It reviewed implementation of the governance structure, controls and the concept of operations for the new program. The Board also provided strategic advice and direction on the elevation of the CRA’s Agency Security Officer position to the Assistant Deputy Commissioner level.

The Board worked closely with the CRA’s Chief Risk Officer, reviewed and provided advice on some of the key risks and opportunities for the CRA in 2020–21. Due to the pandemic and a fast changing environment during the year, the Board switched from annual to quarterly reviews of reports on the CRA’s corporate risk profile and possible impacts of the risks on the CRA operations and employees and the CRA developed action plans to mitigate the risks.

As part of its corporate oversight responsibilities, the Board reviewed and approved various corporate policies and strategies during this fiscal. This ensured a strong governance foundation and robust risk mitigation, and helped the CRA align its business priorities with its corporate policy priorities.

Enabling innovation

The Board continued to encourage the CRA to boldly innovate and capitalize on lessons learned from doing business differently during the pandemic, either by changing processes or using digital and other emerging technologies. The Board supported the ethical use of artificial intelligence (AI) and provided advice on the need for a strong governance structure around the use of AI, resulting in the launch of the AI Directive.

Under the Board’s oversight, the CRA finalized its Innovation Plan with dedicated funding of up to $10 million for the next three years (2021–22 through 2023–24) to conduct experiments.

In line with the Board and CRA priority related to innovation, the CRA initiated assessments and consultations to identify opportunities to advance innovation in business intelligence. It created advanced analytics teams and a working group of data analysts from different areas in the CRA to share research projects and leverage data analytics. The CRA also continued to develop tools and analysis to identify non-compliance.

Empowering CRA’s employees to excel

In 2020, for the fourth year in a row, the CRA was recognized as the preferred employer of choice and one of the top 100 employers in Canada. The pandemic proved the agility and the dedication of the CRA’s employees when most of them had to switch to working remotely, and were called upon to deliver emergency relief benefits on behalf of the Government of Canada.

The Board stayed abreast of the CRA’s efforts to ensure the well-being of its employees, and it oversaw CRA education and awareness initiatives to help its employees adapt to working remotely. The CRA’s annual workforce plan was reviewed and approved by the Board, with a special focus on the following: the well-being of employees; the CRA’s efforts towards making its workplace more diverse, inclusive and free of racism; and the future of workplace and learning.

Under the Board’s Human Resources Committee’s (HRC) oversight, the CRA started to define its future workplace vision and demonstrated leadership within the Government of Canada by helping set the direction for other departments and agencies. The CRA is working closely with Public Services and Procurement Canada (PSPC) and other partners to develop the implementation strategies to realize this vision.

The Board’s HRC also oversaw the implementation of the CRA’s diversity and inclusion strategy and character based leadership model.

The Board oversaw the CRA’s efforts towards redesigning its staffing and performance management programs to attune them to the current and future work environment and make them more effective and efficient. The CRA undertook various online initiatives to help employees, managers, and executives to develop knowledge and skills. CRA staff redesigned courses for virtual delivery, developed learning tools and tested new technologies. Newly hired CRA employees attended a new virtual orientation session and the first virtual executives (EX) Forum was delivered in 2020.

In 2020–21, the CRA conducted four internal employee surveys to gauge how employees were coping and how the pandemic affected their work. These survey results propelled the exploration of the workplace of the future, assisted in online tools development and helped the CRA adjust its annual workforce plan.

The Board received updates on the CRA’s succession plans to ensure it has the right leadership in place to lead its employees, now and into the future. This year also saw successful integration of character leadership assessment into all entry level executive staffing processes.

Overall, the survey results indicated that CRA employees felt their supervisors kept them up to date with relevant information. Under the Board oversight, the managers were encouraged to be mindful of their own well-being, and they were supported by an updated Guide on Virtual Work Arrangements to reflect the reality of the COVID-19 pandemic.

While much work has been done during this year to support CRA employees, the Board will continue to work with the CRA management in ensuring that its workforce reflects Canada’s diverse population, has the tools it needs to succeed and serve Canadians, remains agile and can access continued learning. The Board and CRA management will also continue working to ensure that the CRA workplace is free of harassment and discrimination.

Conclusion

The Board in partnership with the CRA management accomplished its overall strategic objectives for 2020–21 and remains committed to:

• continuing to support the CRA management in its post-pandemic business resumption efforts
• fulfilling its oversight responsibilities in its fiduciary role
• providing strategic advice and guidance to the CRA
• exploring innovative methods to streamline Board governance and social responsibility to make its oversight role more effective and efficient

The Board is proud to have been recognized by the Governance Professionals of Canada for a second year in a row for excellence in governance innovation and resilience and for enterprise risk management oversight.  

The Board thanks the Commissioner of Revenue, Mr. Bob Hamilton for his leadership, and is also grateful to the CRA management and employees for their strong support as it carries out its fiduciary obligations.

The Board particularly appreciates the CRA’s commitment and effort during the pandemic and looks forward to seeing the momentum continue as the CRA strives to better serve Canadians, as a world-class tax and benefit administration.

Analysis of trends in spending and human resources

Actual expenditures

CRA spending trend^{Footnote 50} 

The majority of the increase in the CRA’s overall budget is attributable to its statutory appropriations, particularly to spending associated with the Climate Action Incentive (CAI) payment (for more details, please see endnote 3^{Footnote 52}  of the Budgetary performance summary table). The CRA is responsible for the administration of the fuel charge in jurisdictions that do not meet the federal carbon pricing benchmark. This includes the delivery of the CAI payment which returns the majority of the direct proceeds from the fuel charge to individuals and families of the province in which the proceeds are raised.

Actual spending under the CRA’s voted appropriations for fiscal years 2018–19 to 2020–21 also includes technical adjustments such as the carry-forward from the previous year and funding for severance payments, parental benefits, and vacation credits. In 2020–21, a significant portion of the increase in spending is a result of retroactive payments associated with the collective bargaining adjustments for employees represented by the Public Service Alliance of Canada – Union of Taxation Employees (PSAC-UTE). The 2020–21 fiscal year also reflects higher spending related to the administration of measures associated with the Government’s response to COVID-19 and growth in funding for federal budget and policy measures announced in prior years.

The 2020–21 total authorities available for use increased by $2.5 billion, or 32%, over its planned spending. Of this amount, $1.1 billion is related to the statutory CAI payment. Other increases are attributable to collective bargaining adjustments, COVID-19 related measures, and the aforementioned technical in-year adjustments (for more details, please see "Authorities approved after Main Estimates" in the supplementary information tables). Of the 2020–21 total authorities, $488 million remained unexpended at year-end and is eligible to be carried forward by the CRA to 2021–22 under its statutory two-year spending authority. A portion of the unexpended amount is the result of CRA resources being temporarily redirected from core tax and benefits workload to deliver critical COVID-19 programs. This also included pausing many strategic investment projects at the beginning of the fiscal year. These funds will be carried forward and directed to emerging operational pressures as well as major investment projects in 2021–22.

Actual revenues netted against expenditures represent amounts recovered by the CRA for the provision of services to Employment and Social Development Canada for the administration of the Canada Pension Plan and the Employment Insurance Act.

Actual human resources

The increase in actual FTEs in 2020–21 is largely attributable to the administration of measures associated with the Government’s response to COVID-19 as well as growth in funding for federal budget and policy measures announced in prior years. Over the planning period, the reduction in FTEs from 42,526 in 2021–22 to 41,494 in 2022–23, is primarily the result of a decrease in funding for the federal carbon pollution pricing system and the taxation regime for cannabis.

A portion of the decrease in internal services FTEs is due to the attribution of direct internal service costs to the programs starting in 2019–20 (primarily within the tax core responsibility).

Expenditures by vote

For information on the CRA’s organizational voted and statutory expenditures, consult the Public Accounts of Canada 2020–2021 ^{Footnote 55} .

Government of Canada spending and activities

Information on the alignment of the CRA’s spending with the Government of Canada’s spending and activities is available in GC InfoBase ^{Footnote 56} .

Supporting information on lower-level programs

Supporting information on lower-level programs is available in GC InfoBase ^{Footnote 57} .

Financial statements and financial statements highlights

Agency Activities

Financial statements

The CRA’s financial statements (unaudited) for the year ended March 31, 2021, are available on the CRA website ^{Footnote 58} .

Financial statements highlights

Future-Oriented Statement of Operations: Departmental Plan – Canada.ca ^{Footnote 59} .

The Agency’s net cost of operations before government funding and transfers in the 2020–21 fiscal year amounted to $5,059.4 million, an increase of $100.1 million from the $4,959.3 million net cost of operations before government funding and transfers in the 2019–20 fiscal year.

Personnel expenses (salaries, other allowances and benefits) represent 77% of total expenses and are the Agency’s primary costs. The remaining 23% of expenses are comprised of other costs such as information technology and accommodation expenses.

Personnel costs have increased by $287.7 million in the 2020–21 fiscal year, including salary expenses ($96.5 million) and other allowances and benefits ($191.2 million). This is mainly explained by an increase in the number of employees, economic salary increases and salary increments. Additionally, a signing bonus and a one-time payment for the late implementation of the 2017 collective agreement were awarded to employees as part of the new Public Service Alliance of Canada (PSAC) – Union of Taxation Employees (UTE) collective agreement ($32.2 million). Members of the Professional Institute of the Public Service of Canada (PIPSC) were also awarded additional damages for the late implementation of the 2014 collective agreement (estimated at $12.1 million).

Non-personnel expenses have increased by $56.8 million in the 2020–21 fiscal year. This net variance in most part results from an increase in information technology services ($54.9 million) and equipment purchases ($35.8 million) and a decrease in travel expenses ($36.9 million), all mainly due to the Agency’s response to COVID-19.

Non-tax revenues have increased by $244.4 million in the 2020–21 fiscal year, attributable to the increase in costs recovered for the administration of COVID-19 programs ($176.4 million) such as the Canada Emergency Response Benefit and for the administration of the Canada Pension Plan and Employment Insurance Act ($84.7 million).

Liabilities have decreased by $180.0 million in the 2020–21 fiscal year. This was mainly attributable to the payment of retroactive salary increases for the expired PSAC-UTE collective agreement ($329.5 million), which reversed the previous years’ salary accruals. The overall decrease was offset by an increase in vacation pay and compensatory leave liability ($80.6 million), which resulted mainly from the increase in salaries and the number of employees as well as the increase in unused vacation banks since the start of COVID-19. Additionally, there was an increase in the amount payable to Treasury Board Secretariat for the final adjustment of the Agency’s 2020–21 fiscal year employee benefit plan costs ($122.8 million).

The increase of $87.7 million in financial assets reflects the increase in the Due from the Consolidated Revenue Fund (CRF) resulting mainly from the increase in the amount payable to Treasury Board Secretariat for the final adjustment of the Agency’s 2020–21 fiscal year employee benefit plan costs ($122.8 million). The Due from the CRF account represents the net amount of cash that the Agency is entitled to draw without using further appropriations to discharge its liabilities.

Non-financial assets are comprised of 94% tangible capital assets. The net book value of tangible capital assets has increased by $32.5 million in the 2020–21 fiscal year. The costs capitalized ($88.7 million) have increased by $24.7 million due to major projects of in-house developed software. 

Administered activities

The CRA administers revenues for the Government of Canada, provincial and territorial governments and First Nations as well as pension contributions and other revenues for the Canada Pension Plan. For the fiscal year 2020–21, total administered revenues amounted to $482,409 million. This represented an increase of $15,193 million or 3.3% from 2019–20. This increase is due to the economic recovery in the latter part of the fiscal year, and the various support measures adopted in Canada’s COVID-19 Economic Response Plan for individuals and corporations.

The CRA administers expenses for the Government of Canada, provincial and territorial governments as well as the doubtful accounts expense for the Canada Pension Plan. The CRA also administers recoveries for the Government of Canada relating to old age security, employment insurance, and Canada recovery benefit. Total net administered expenses and recoveries amounted to $195,082 million in 2020–21, an increase of $154,320 million or 378.6% from 2019–20. The increase primarily reflects expenses administered in regards to Canada’s COVID-19 Economic Response Plan to support the Canadian economy during the COVID-19 global pandemic.

Total administered assets amounted to $150,603 million as at March 31, 2021, an increase of $26,182 million or 21.0% from 2019–20. The increase is primarily due to higher individuals accounts receivable as a result of higher revenues, as well as taxable COVID-19 benefit payments and the expiration of the payment extension relief measures as announced in the Canada’s COVID-19 Economic Response Plan.

Administered liabilities amounted to $72,411 million as at March 31, 2021, an increase of $11,423 million or 18.7% from 2019‑20. The increase reflects COVID-19 transfer payments issued in April-May 2021 that were payable on March 31, 2021, as well as lower amounts payable at the end of 2019-20 due to a reduction in amounts assessed in April-May 2020 due to filing deferral measures under Canada’s COVID-19 Economic Response Plan.

Corporate information

Organizational profile

Appropriate minister: The Honourable Diane Lebouthillier, P.C., M.P.

Institutional head: Bob Hamilton

Chair, Board of Management: Suzanne Gouin

Ministerial portfolio: National Revenue

Enabling instrument: Canada Revenue Agency Act, S.C. 1999, c. 17

Year of commencement: 1999

Raison d’être, mandate and role

Information on the CRA’s raison d’être, mandate and role is available on the CRA website.

For more information on the CRA’s organizational mandate letter commitments, see the Minister’s mandate letter and supplementary mandate letter.

Operating context

Information on the CRA’s operating context is available on the CRA website.

Reporting framework

The CRA’s Departmental Results Framework and Program Inventory of record for 2020–21 are shown below.

Supporting information on the program inventory

Financial, human resources and performance information for CRA’s Program Inventory is available in GC InfoBase.

Supplementary information tables

The following supplementary information tables are available on the CRA website:

• Reporting on Green Procurement
• Authorities approved after Main Estimates (dollars)
• Details on transfer payment programs
• Gender-based Analysis Plus (GBA Plus)
• Response to parliamentary committees and external audits
• Board of Management attendance record for 2021 and compensation rates

Federal tax expenditures

The tax system can be used to achieve public policy objectives through the application of special measures such as low tax rates, exemptions, deductions, deferrals and credits. The Department of Finance Canada publishes cost estimates and projections for these measures each year in the Report on Federal Tax Expenditures. This report also provides detailed background information on tax expenditures, including descriptions, objectives, historical information and references to related federal spending programs as well as evaluations and GBA Plus of tax expenditures.

Public Service Commission and assessment of recourse reports

The Canada Revenue Agency Act requires the CRA to include in its annual reporting a copy of any report produced under subsection 56(1) or a summary statement of any assessment produced under section 59. The report and assessment are produced on an as needed basis. During 2020–21, the Public Service Commission did not prepare, or have prepared on its behalf, a report to the CRA pursuant to subsection 56(1) of the Canada Revenue Agency Act on the consistency of the CRA’s staffing program with the principles set out in the Summary of its Corporate Business Plan. For the same period, the CRA did not prepare pursuant to section 59 of the Canada Revenue Agency Act an assessment of the recourse the CRA provides or administers in its management of human resources.

Organizational contact information

Connaught building

555 MacKenzie Avenue

Ottawa ON K1A 0L5

Telephone: 613-957-3688

Website: www.canada.ca/en/revenue-agency

Appendix: definitions

• Appropriation: Any authority of Parliament to pay money out of the Consolidated Revenue Fund.
• Business intelligence: Refers to processes, technologies, tools and analytical methods needed to turn data into information, information into knowledge, and knowledge into plans that drive program activities and actions.
• Client experience approach: The client experience approach encompasses how a client views all interactions across all channels over time. Creating a positive experience involves analyzing the entire client journey and continuously identifying improvement opportunities to create the best possible experience.
• Common Reporting Standard (CRS): An international standard, developed by the Organization for Economic Cooperation and Development, for the automatic exchange of information on "Financial Accounts" (such as bank, mutual fund and brokerage accounts, segregated fund contracts and certain annuity and insurance contracts) between CRS participating countries, which includes Canada.
• Core responsibility: An enduring function or role performed by a department. The intentions of the department with respect to a core responsibility are reflected in one or more related departmental results that the department seeks to contribute to or influence.
• Departmental Plan: A report on the plans and expected performance of an appropriated department over a three-year period. Departmental Plans are usually tabled in Parliament each spring.
• Departmental result: A consequence or outcome that a department seeks to achieve. A departmental result is often outside the departments’ immediate control, but it should be influenced by program-level outcomes.
• Departmental result indicator: A quantitative measure of progress on a departmental result.
• Departmental results framework: A framework that connects the department’s core responsibilities to its departmental results and departmental result indicators.
• Departmental Results Report: A report on a department’s actual accomplishments against the plans, priorities and expected results set out in the corresponding Departmental Plan.
• Experimentation: The conducting of activities that seek to first explore, then test and compare the effects and impacts of policies and interventions. Experimentation activities help to inform evidence-based decision-making, and improve outcomes for Canadians, by learning what works, for whom and in what circumstances. Experimentation is related to, but distinct from innovation (the trying of new things), because it involves a rigorous comparison of results. For example, using a new website to communicate with Canadians can be an innovation; systematically testing the new website against existing outreach tools or an old website to see which one leads to more engagement, is experimentation.
• Full time equivalent: A measure of the consumption of people time – one person working full time (37.5 hours per week) for one year equals one FTE.
• Gender-based Analysis Plus (GBA Plus): An analytical process used to assess how diverse groups of women, men and gender-diverse people experience policies, programs and services based on multiple factors including race, ethnicity, religion, age, and mental or physical disability.
• Performance: Results achieved compared with intended objectives.
• Performance indicator: A qualitative or quantitative means of measuring an output or outcome, with the intention of gauging the performance of an organization, program, policy or initiative against expected results.
• Plan: The articulation of strategic choices, which provides information on how an organization intends to achieve its priorities and associated results. Generally, a plan will explain the logic behind the strategies chosen and tends to focus on actions that lead to the expected result.
• Planned spending: For Departmental Plans and Departmental Results Reports, planned spending refers to those amounts presented in Main Estimates. A department is expected to be aware of the authorities that it has sought and received. The determination of planned spending is a departmental responsibility, and departments must be able to defend the expenditure and accrual numbers presented in their Departmental Plans and Departmental Results Reports.
• Platform economy: Refers to economic and social activities facilitated by the use of technologies such as the Internet and mobile applications. Entities referred to as "platforms" use technology to connect buyers and consumers with sellers and service providers.
• Program: Individual or groups of services, activities or combinations thereof that are managed together within the department and focus on a specific set of outputs, outcomes or service levels.
• Program inventory: Identifies all the department’s programs and describes how resources are organized to contribute to the department’s core responsibilities and results.
• Result: A consequence attributed, in part, to an organization, policy, program or initiative. Results are not within the control of a single organization, policy, program or initiative; instead they are within the area of the organization’s influence.
• Statutory expenditures: Expenditures that Parliament has approved through legislation other than appropriation acts. The legislation sets out the purpose of the expenditures and the terms and conditions under which they may be made.
• Target: A measurable performance or success level that an organization, program or initiative plans to achieve within a specified time period. Targets can be either quantitative or qualitative.
• Voted expenditures: Expenditures that Parliament approves annually through an appropriation act. The vote wording becomes the governing conditions under which these expenditures may be made.