departmental performance report 2012-13

[section 2: our programs]

[assessment of returns and payment processing]

[program description]

The CRA undertakes a wide range of activities to assess and process tax returns, information returns, and payments for individuals and businesses. We undertake activities that make it easier for individuals and businesses to meet their filing, reporting, and payment obligations. We assess, process, and adjust tax returns for individuals and businesses. We review information provided to find errors. We detect non-compliance through risk assessment and third-party data matching. Through these activities, we support the process of assessing tax returns from beginning to end.

2012-2013 financial resources (thousands of dollars)
Total budgetary expenditure Planned spending
(Footnote 1)
Total authorities Actual spending
(Footnote 2)
Difference
617,948 660,575 709,447 643,800 16,775
Sub-program Planned spending
(Footnote 1)
Actual spending
(Footnote 2)
Difference
Individual returns and payment processing 308,438 298,365 10,073
Business returns and payment processing 209,137 203,212 5,925
GST administration in Quebec 143,000 142,223 777
Total 660,575 643,800 16,775

Numbers may not add due to rounding.

     

(Footnote 1): Planned spending has been restated from what was shown in the Canada Revenue Agency 2012-2013 Report on Plans and Priorities in order to distribute the real property accommodations funding (previously centralized in the internal services program) to all applicable programs. It should also be noted that planned spending excludes severance payments, parental benefits and vacation credits, as this funding is received during the fiscal year and is only included in actual spending.

(Footnote 2): This figure represents the actual spending for the program on a modified cash basis. Please refer to page 154 of the CRA Annual Report to Parliament 2012-2013 for an explanation of how this figure relates to the CRA Financial Statements – Agency Activities.

2012-2013 human resources (full-time equivalents)
Sub-program Planned Actual Difference
Individual returns and payment processing 4,235 3,958 277
Business returns and payment processing 2,805 2,577 228
GST administration in Quebec nil nil nil
Total 7,040 6,535 505

Numbers may not add due to rounding.

     
[sub-program description]

Individual returns and payment processing

The Individual Returns and Payment Processing Program ensures individuals have the services they require to voluntarily comply with Canada's tax laws. It processes all the information filed and payments submitted by individuals. It also assesses and validates the information and advises individuals of the results of their assessment or reassessment.

Business returns and payment processing

The Business Returns and Payment Processing Program ensures businesses have the services they require to voluntarily comply with Canada's tax laws. It processes all the information filed and payments submitted by businesses. It also assesses and validates the information and advises businesses of the results of their assessment or reassessment. The program also registers businesses in Canada for a business number, maintains account status and administers the excise programs.

GST administration in Quebec

The Goods and Services Tax Administration in Quebec Program administers both the memorandum of understanding with Revenu Québec and payments to Revenu Québec for the administration of the goods and services tax in the province of Quebec.

[performance analysis and lessons learned]

[supporting the assessment of returns and payment processing]

Filing returns and making payments should be easy. Recognizing that Canadians are increasingly turning towards online services to interact with government, we maintain portals like My Account and My Business Account so that taxpayers can manage their tax and benefit information online. Taxpayers are more likely to comply if it is easy to do so, and the services we offer make managing tax affairs and filing tax returns easy and simple.

Photo description: Computer key with the word services on it

[My Account for individuals]

We launched My Account in 2003 in response to growing demand for self-service and to allow users to take control of their data, enabling them to access their information from anywhere at any time. My Account is a secure portal that allows an individual to track their refund, view or change their return, check their benefit and credit payments and RRSP limit, change their address or phone numbers, set up direct deposit, and much more.

Key result:

We continually look to improve functionalities in My Account as we want to provide greater flexibility and new ways for users to manage their tax affairs. To that end, we made several improvements and added new services to My Account, including:

Taxpayers and benefit recipients can view basic tax information using Quick Access. To do so, they need to confirm their identity using their social insurance number, date of birth, and information entered on their income tax and benefit returns from previous years. This service gives an individual immediate access to some of their information in My Account, such as the ability to view tax return status, RRSP deduction limit, TFSA contribution room, and the status of benefit payments.

Key result:

Focus on small businesses

Small businesses are the heart of the Canadian economy. Since 98% of Canadian businesses have fewer than 100 employees, the time and resources spent to deal with regulatory issues represent a major concern for the competitiveness of the sector. As a result, the CRA is taking on a number of initiatives to reduce the administrative burden and the time and costs associated with filing tax returns and payment processing for businesses. Our goal is to make it faster and easier for Canadian businesses to do business with the CRA and to comply with Canada's tax laws.

The initiative to establish the CRA's business number as the common identifier for federal, provincial, and municipal interactions with businesses is part of the effort to improve information sharing and reduce the number of interactions with government for small businesses. So far, six provinces and one city have adopted the business number. We expect more municipalities and governments to adopt the business number to facilitate registration and eliminate duplicate accounts and errors.

Small businesses have ideas on how the CRA can better respond to their needs, and we consult with them regularly to better understand their concerns and implement changes in service when possible. For example, after consulting with small businesses in November 2012, we promoted direct deposit and the hiring credit for small business and launched our new business landing page www.cra-arc.gc.ca/businessonline. We know that small businesses will find it convenient to be able to access services like submit an enquiry, ask for a CPP/EI ruling, and calculate payroll deductions from the same Web page.

[My Business Account]

My Business Account is a secure online portal that allows business owners to have immediate access to their information and to manage various business accounts such as GST/HST, payroll, corporation income taxes, excise taxes, excise duties, and more. For example, the ability to download missing tax information slips can save business owners time and aggravation. This portal is invaluable for business owners who want to monitor their tax affairs closely. Authorized representatives can also access these services through Represent a Client.

Key result:

My Business Account is one of the main focuses of our strategy to empower business owners and to reduce the cost, time, and effort that go into complying with Canada's tax laws. To deliver on the needs and expectations of business owners, we made several improvements and added new services to My Business Account, including:

[Represent a Client]

Tax preparers are playing an increasingly important role in managing tax affairs on behalf of individuals and businesses. To facilitate the work of tax preparers and make it easier to comply with Canada's tax laws, the CRA launched the secure portal Represent a Client in 2006. This was a unique service in the world at that time.

Represent a Client allows a tax preparer or a representative to access tax information and services on behalf of individuals and businesses. The representative can be a friend or family member, an owner of a business that provides tax or payroll services for clients, or an employee of a business that provides tax or payroll services.

In 2012-2013, we improved the registration process for Represent a Client by making it much easier and faster for representatives to register for the service. Representatives now require only one identifier for their dealings with the CRA on behalf of clients and family members.

Key results:

[major initiative]

Taxpayers and businesses want to save time and money. The CRA is exploring ways to support the assessment of returns and payment processing that reduce paper work, reduce the number of interactions between the CRA and taxpayers, and meet taxpayers' expectations for cost-effective service from the CRA.

Our latest initiative is Submit Documents, a secure online method for taxpayers and their representatives to submit supporting documentation and receipts to the CRA. Submit Documents was implemented in 2012 for our first early adopter, the Corporation Assessing Review Program.

[Community Volunteer Income Tax Program]

Every year, thousands of eligible Canadians are getting help from volunteers of the Community Volunteer Income Tax Program (CVITP). Since filing an income tax and benefit return is essential for an individual to receive their entitled benefits, the CRA has a vested interest in supporting CVITP volunteers. As such, the CRA expects to continue to play an important role in offering training and tax software for the volunteers as well as a network of coordinators to guide community organizations as they deliver the program.

Key result:

Increasing electronic filing

Online filing offers the benefits of being faster, simpler, more efficient and more environmentally sustainable than filing paper returns. In 2011, roughly 1.3 million tax-filing packages were mailed out but never used. As more taxpayers shift to online services, including electronic filing, use of our printed products and TELEFILE service has diminished significantly.

The CRA has committed to reducing costs and waste. As a result, the TELEFILE service for individuals was discontinued and T1 personalized income tax and benefit packages were not mailed out for the 2012 tax year. However, Canadians were still able to file in the traditional fashion - on paper. The CRA introduced initiatives to increase electronic filing and achieve better consistency, including:

  • Updating the Get ready Web page to better accommodate first-time electronic filers.
  • Eliminating the NETFILE access code. Only the taxpayer's SIN and date of birth are required to NETFILE.
  • Permitting first-time filers to NETFILE.
  • Promoting free certified software on the CRA Web site and in various CRA communication products.
  • Introducing mandatory electronic filing for tax preparers who, for a fee, prepare more than 10 corporation or individual returns.

[assessing returns and payment processing]

Each year, the CRA assesses millions of tax returns for individuals and businesses. We process these returns and enter the information into our systems to update taxpayer accounts and determine the current status of their tax obligations. We then store the returns for future reference. We carry out activities to detect non-compliance both before and after tax returns are assessed. When we find errors on tax returns, we correct them. Our goal is to process returns and payments as quickly and accurately as possible so that Canadians maintain confidence in the integrity of Canada's self-assessment system and Canada's revenue base is protected.

Although we missed slightly on our service standard for processing GST/HST returns, we exceeded our targets for processing corporation income tax returns and excise tax, duty, air travellers security charge, and softwood lumber returns.

Key results:

More individuals and businesses are filing and paying online because it is quicker and easier. The CRA can process electronic returns and payments faster; individuals who have previously set up direct deposit can expect to receive their refunds in as little as eight business days. Taxpayers who request electronic adjustments to their income tax and benefit returns can expect us to respond within two weeks. This compares favourably to the seven weeks we usually need to process requests submitted on paper.

We led a strong campaign to encourage individuals to file electronically during the 2013 tax-filing season. A record 76% of income tax and benefit returns were filed electronically, 11 percentage points over the percentage of income tax and benefit returns filed electronically between February 2012 and August 2012.

/gncy/prfrmnc_rprts/2012-2013/images/MP900409734-eng.txt

Key results:


[correct and detect]

We analyze tax returns to find errors, like an amount placed on the wrong line, and to detect non-compliance. We take note of common errors to find gaps in information or services. We also detect inadmissible claims through an initial review of tax credits and amounts claimed. Finding and fixing errors as part of our early intervention programs helps us resolve non-compliance in the least intrusive way and minimizes the risk of taxpayers paying penalties and interest.

We also identify unclaimed tax credits, benefits, and overpayments for taxpayers. Then, we adjust income tax and benefit returns to reflect the beneficial adjustments.

Key results:

We continue our review of income tax and benefit returns after notices of assessment are sent. We select files and contact taxpayers to request further information to verify claims made on tax returns. We also compare the information we have from third parties with the information reported on tax returns. We review corporation income tax returns to ensure the accuracy and validity of corporation income tax return assessments.

Key results:

Together, our efforts resulted in over $1.3 billion in additional tax assessed.

[conclusion]

More Canadians are choosing to manage their tax affairs through our online portals: My Account, My Business Account, and Represent a Client.

Although more Canadians enjoy the benefits of self-service, third parties are also playing a greater role in helping Canadians comply with Canada's tax laws.

The CRA is strengthening its relationship with tax preparers. By completing and filing income tax and benefit returns on behalf of millions of Canadians every year, tax preparers play an essential role in Canada's tax system. The CRA can help taxpayers comply by working with tax preparers to promote good compliance practices and by strengthening our support for the services they provide to their clients.

The CRA will continue to develop tools and services with a view to making filing and paying taxes easier and faster. Although online self-service will remain the preferred service option, the CRA will ensure that Canadians can still file their income tax and benefit returns on paper or ask for a remittance voucher to pay by cheque.

Business registration evaluation report

During 2012-2013, we conducted an internal evaluation of the CRA Business Number (BN) Program with a focus on the issues of registration efficiency, effectiveness, and coordination within the CRA.

The evaluation found that while the CRA efficiently processes applications, program costs vary significantly depending on the method of registration chosen. Registration through the online option appears to be the most cost-efficient and effective method.

The report found that there is no legislation specifying what information must be provided to obtain a BN or governing the use of information. The report also mentioned that incomplete registration data can negatively affect the CRA's efforts to ensure compliance with tax obligations.

Following these findings, the CRA will examine the costs and benefits associated with the current registration method to ensure that our approach takes full advantage of technology, existing data, and verification/validation processes.

Details can be found on the CRA Web site at: www.cra-arc.gc.ca/gncy/ntrnl/2013/bsnss-rgstrtn-eng.html#h2

[performance results]
Expected results Indicators Targets 2010-2011 2011-2012 2012-2013
The CRA supports the timely and accurate processing of
tax, information, and benefit returns, and the
processing of payments
Number of successful log-ins to My Account Upward trend 4,690,737 5,837,173 6,705,022
  Number of successful log-ins to My Business Account Upward trend 1,240,702 1,913,141 2,664,791
  Represent a Client - Individual accounts accessed   Upward trend 3,193,919 4,522,971 5,547,661
  Represent a Client - Business accounts accessed Upward trend 1,162,177 1,850,268 2,662,741
  Percentage of payments made electronically Upward trend 29.7% 33.4% 36.7%
  Percentage of individuals who file electronically Upward trend 64% (Footnote 1) 65% (Footnote 1) 76%
  Percentage of corporations that file electronically Upward trend 46.8% 61.4% 69.9%
  Percentage of GST/HST returns filed electronically Upward trend 41.3% 57.5% 64.3%
Individuals, businesses and registrants are provided timely
and accurate tax assessment notices and tax payment processing
Process Excise Tax, Duty, Air Travellers Security Charge and
Softwood Lumber returns within 90 days of receipt
95% 97.6% 98.2% 98.4%
  Process GST/HST returns within 30 days 95% 90.3% 91% 93.8%
  Process T2 corporate income tax returns within 60 days 90% 94.5% 95.2% 95.2%
  Respond to T1 taxpayer-requested adjustments within
an average of 8 weeks
100% 7.2 weeks 7 weeks 7 weeks
  Respond to T1 taxpayer-requested adjustments received
via the Internet within an average of 2 weeks
100% 1.8 weeks 1.8 weeks 2 weeks
  Process paper T1 individual income tax returns within an
average of 4 to 6 weeks
100% 3.9 weeks 3.9 weeks 4.3 weeks
  Process electronic (EFILE, TELEFILE, NETFILE) T1 individual income
tax returns within an average of 2 weeks 
100% 1.7 weeks 1.6 weeks 1.6 weeks
  Processing T3 trust returns within 4 months 95% 98.5% 98.7% 98.7%
Individual taxfilers receive timely and accurate assessment notices Percentage of the 5 service standards pertaining to individual
and trust returns (T1 and T3) activities which have met
targeted performance standards
100% 100% 100% 100%
  Percentage of individual (T1) returns processed accurately 98% 98.8% 98.8% 99%
  Individual (T1) returns received on time processed by mid-June 100% 100% 100% 100%
Validation activities detect and address non-compliance
by individuals with the reporting requirements of the acts
Percentage of validation reviews of individual returns (T1)
completed compared to planned
100% n/a  n/a 104%
  Ratio of average dollar value assessed for targeted vs random reviews Minimum ratio of 2:1  n/a  n/a 2.6:1

Remittance of payments by individuals and businesses to the Receiver General are processed on time

Percentage of payments by individuals and businesses
to the Receiver General deposited within 24 hours of receipt
96% 99.6% 99.3% 99.4%

(Footnote 1): Results have been re-stated as they are now calculated based on the tax-filing season February 1 to August 31 versus April 1 to March 31.

n/a: This is a new indicator for 2012-2013. Prior year results are not available.

Page details

Date modified: