Limitation period on exercising discretion and the deadline for requesting relief

The Minister's discretion to grant relief is limited to any period that ended within 10 years before the calendar year in which a request is submitted or an income tax return is filed.

Penalty, election, and refund or adjustment requests – Income Tax Act

A taxpayer has 10 years from the end of the calendar year in which the tax year or fiscal period at issue ended to make a request to the Canada Revenue Agency (CRA) for relief to:

  • cancel or waive penalties;
  • accept a late, amended, or revoked income tax election; or
  • issue a refund or adjustment beyond the normal three-year period

This means that for requests or income tax returns that are filed in the current calendar year, the Minister has no authority to provide relief when the request is for a tax year or fiscal period that ended more than 10 years before the calendar year in which the request is made.

Example

  • To be eligible for consideration, an initial request or income tax return filed during the 2015 calendar year must deal with an issue related to the taxpayer's 2005 and later tax years (or fiscal periods). A request or return related to a taxpayer’s 2004 and previous tax years (or fiscal periods) is not eligible for consideration since those tax years (or fiscal periods) are beyond the 10-year period.

The 10-year limitation period rolls forward every January 1.

Interest requests - Income Tax Act, Excise Tax Act, Air Travellers Security Charge Act, Softwood Lumber Products Export Charge Act, 2006, and Excise Act, 2001

Under the 10-year limitation period, the Minister may cancel or waive interest that accrued within the last 10 calendar years before the year the request is made for any tax year or reporting period.

Example

  • An initial request made during the 2015 calendar year related to any interest that accrued during the 2005 and later calendar years, for any tax year or reporting period, is eligible for consideration. Any interest that accrued before January 1, 2005, is not eligible for consideration.

The 10-year limitation rolls forward every January 1.

GST/HST registrants and claimants - Excise Tax Act

Regarding a GST/HST return for a reporting period that ended within 10 years before the calendar year in which the request is made, the Minister may cancel or waive all or a portion of the:

  • failure to file a return penalty payable under section 280.1;
  • failure to electronic file penalty payable under section 280.11; and
  • failure to accurately report information penalty payable under section 284.01.

Example

  • An initial request made during the 2015 calendar year related to a penalty for a reporting period that ended within 10 years before the calendar year in which the request is made is eligible for consideration. A request made for a reporting period that ended more than 10 years before the calendar year in which the request is made is not eligible for consideration.

The Minister may also grant relief from the 6% GST/HST failure to remit penalty payable before April 1, 2007, under former section 280 and similar penalties that accrued under the non-GST/HST portion of the Excise Tax Act. For these penalties, the Minister may cancel or waive the penalty that accrued within the last 10 calendar years before the year the request is made for any reporting period.

Example

  • An initial request made during the 2015 calendar year related to the failure to remit and similar penalties that accrued during the 2005 and later calendar years, for any reporting period, is eligible for consideration. Any penalty that accrued before January 1, 2005, is not eligible for consideration.

The 10-year limitation period rolls forward every January 1.

For GST/HST interest related requests, please see the section above called Interest requests.

Other penalties

For a reporting period that ended within 10 years before the calendar year in which the request is made, the Minister may cancel or waive all or a portion of the:

  • failure to file a return penalty payable under section 53 of the Air Travellers Security Charge Act;
  • failure to file a return penalty payable under section 64 of the Softwood Lumber Products Export Charge Act, 2006; and
  • failure to file a return penalty payable under section 251.1 of the Excise Act, 2001.

Example

  • An initial request made during the 2015 calendar year related to a failure to file penalty for a reporting period that ended within 10 years before the calendar year in which the request is made is eligible for consideration. A request made for a reporting period that ended more than 10 years before the calendar year in which the request is made is not eligible for consideration.

The Minister may also grant relief from the 6% failure to remit penalty payable before
April 1, 2007, under former section 53 of the Air Travellers Security Charge Act. For this penalty, the Minister may cancel or waive the penalty that accrued within the last 10 calendar years before the year the request is made for any reporting period.

Example

  • An initial request made during the 2015 calendar year related to the failure to remit penalty that accrued during the 2005 and later calendar years is eligible for consideration.

The 10-year limitation period rolls forward every January 1.

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