Taxpayer Relief Program v1.0

Appeals Branch
Program Management Directorate

On this page

• Overview & Privacy Impact Assessment Initiation (PIA)
• Summary of the project, initiative or change
• Risk identification and categorization

Overview & Privacy Impact Assessment (PIA) Initiation 

Government institution

Canada Revenue Agency

Government official responsible for the PIA

Tammy Branch
Assistant Commissioner
Appeals Branch

Head of the government institution or Delegate for section 10 of the Privacy Act

Anne Marie Laurin
Director General
Access to Information and Privacy Directorate

Name of program or activity of the government institution

Taxpayer Relief Program

Standard or institution specific class of record:

Taxpayer Relief Program
Record Number CRA APP 585

Standard or institution specific personal information bank:

Taxpayer Relief Program
Bank number CRA PPU 580
TBS Registration Number 003943

Legal authority for program or activity

• Waiver of penalty or interest
  • (3.1) The Minister may, on or before the day that is ten calendar years after the end of a taxation year of a taxpayer (or in the case of a partnership, a fiscal period of the partnership) or on application by the taxpayer or partnership on or before that day, waive or cancel all or any portion of any penalty or interest otherwise payable under this Act by the taxpayer or partnership in respect of that taxation year or fiscal period, and notwithstanding subsections 152(4) to (5), any assessment of the interest and penalties payable by the taxpayer or partnership shall be made that is necessary to take into account the cancellation of the penalty or interest.

Excise Tax Act: Subsections 88(1), 281.1(1), 281.1(2), 284.1(3)

• Non-GST: Subsection 88(1) permits the CRA to cancel or waive penalties and interest payable under Parts I to VII (non-GST/HST)
• GST: Subsection 281.1(1) of the Excise Tax Act permits the CRA to cancel or waive interest payable under section 280 of this Act. Subsection 281.1(2) of the Excise Tax Act permits the CRA to cancel or waive late remitting penalty payable before April 1, 2007, under section 280 and the failure to file penalty payable as of April 1, 2007, under section 280.1 of this Act.
• Subsection 281.1(2)(b) permits the CRA to cancel or waive a penalty for failure to file a return electronically charged under section 280.11, and the penalty for failure to report information on a return or misstate amounts on a return under section 284.01 of the Excise Tax Act.
• Subsection 284.1(3) permits the CRA to cancel or waive the penalty payable by a reporting institution under subsection 284.1(1) for a failure to report an actual amount and the penalty payable by a reporting institution under subsection 284.1(2) for a failure to provide reasonable estimates.

Excise Act, 2001

• Section 173 of the Excise Act, 2001 permits the CRA to reduce or waive interest payable under this Act.
• Effective April 1, 2007, section 255.1 gives the Minister the authority to waive or reduce any penalty payable under section 251.1 (failure to file penalty) in respect of a return for any reporting period before the day that is ten calendar years after the end of the reporting period.

Air Travellers Security Charge Act

• Subsection 30(1) of the Air Travellers Security Charge Act permits the CRA to reduce or waive interest payable under this Act while subsection 55(1) permits to cancel or waive penalties.

Softwood Lumber Products Export Charge Act, 2006

• Subsection 37(1) of the Softwood Lumber Products Export Charge Act, 2006 permits the CRA to waive or cancel interest or a penalty payable under section 64 of this Act, effective October 12, 2006.

Greenhouse Gas Pollution Pricing Act

• Subsection 100(1) of the Greenhouse Gas Pollution Pricing Act permits the CRA to waive, cancel or reduce any interest payable under Part 1 of the Greenhouse Gas Pollution Pricing Act, while subsection 125(1) permits the CRA to waive or cancel all or part of any penalty payable under this Part.

Tax Administration Act

• For the Minister of Revenu Québec, the Minister of National Revenue is responsible for using discretion under section 94.1 of the Tax Administration Act to waive or cancel interest, penalties, or charges payable by a selected listed financial institution for their Québec sales tax (QST) obligations.

Customs Act

• Waiver of penalty or interest
  • 3.3 (1) Except with respect to the collection of any debt due to His Majesty under Part V.1, the Minister or any officer designated by the President of the Canada Border Services Agency for the purposes of this section may at any time waive or cancel all or any portion of any penalty or interest otherwise payable by a person under this Act.

Underused Housing Tax Act

• Waiving or reducing interest
  • 26 (1) The Minister may, on or before the day that is 10 calendar years after the end of a calendar year of a person, or on application by the person on or before that day, waive, cancel, or reduce any interest payable by the person under this Act on an amount that is required to be paid by the person under this Act in respect of the calendar year.
• Waiving or cancelling penalties
  • 48 (1) The Minister may, on or before the day that is 10 calendar years after the end of a calendar year of a person, or on application by the person on or before that day, waive or cancel all or any portion of any penalty under this Act payable by the person in respect of the calendar year.

Select Luxury Items Tax Act

• Waiving or reducing interest
  • 85 (1) The Minister may, on or before the day that is 10 calendar years after the end of a reporting period of a person, or on application by the person on or before that day, waive, cancel, or reduce any interest payable by the person under this Act on an amount that is required to be paid by the person under this Act in respect of the reporting period.
• Waiving or cancelling penalties
  • 120 (1) The Minister may, on or before the day that is 10 calendar years after the end of a reporting period of a person, or on application by the person on or before that day, waive or cancel all or any portion of any penalty under this Act payable by the person in respect of the reporting period.

Digital Services Tax Act

• Waiving or cancelling interest
  • Subsection 58(1) allows the Minister to waive or cancel interest payable by a person. However, interest on an amount payable in respect of a calendar year cannot be waived or cancelled after 10 years have passed since the end of that calendar year. Any assessment that is necessary to take into account the waiver, cancellation or reduction of the interest may be made, regardless of the general seven-year limitation period for assessments.
  • It should be noted that the Minister has full discretion over the use of this waiver. The Minister need not waive or cancel interest unless the Minister considers it appropriate to do so.
• Waiving or canceling penalties
  • Subsection 91(1) allows the Minister, at the Minister’s discretion, to waive or cancel penalties payable by a person. However, penalties cannot be waived more than ten years after the end of the calendar year in which the penalty became payable.
  • This subsection also allows the Minister to make assessments outside of the general seven-year limitation period for assessments in order to give effect to the waiver or cancellation of the penalty.

Global Minimum Tax Act (draft legislation)

• Waiving or cancelling interest
  • 71(1) The Minister may, on or before the day that is 10 calendar years after the end of a particular fiscal year, or on application by a person on or before that day, waive, cancel or reduce any amount otherwise payable under this Act that is interest payable by the person on an amount that is required to be paid by the person in respect of the particular fiscal year, and despite subsection 84(1), any assessment of the interest payable by the person may be made that is necessary to take into account the waiver, cancellation or reduction of the interest.
• Waiving or cancelling penalties
  • 104 (1) The Minister may, on or before the day that is 10 calendar years after the end of a fiscal year in which a penalty became payable under this Act by a person, or on application by the person on or before that day, waive or cancel all or any portion of that penalty, and despite subsection 84(1), any assessment of the penalty payable by the person may be made that is necessary to take into account the waiver or cancellation of the penalty.

Summary of the project, initiative or change

Overview of the Program or Activity

The Minister may grant relief from penalties and interest when the following types of situations prevent a taxpayer from meeting their tax obligations:

• extraordinary circumstances
• actions of the CRA
• inability to pay or financial hardship
• other circumstances

Program activities:

• The Taxpayer Relief Division is responsible for the development and coordination of the Taxpayer Relief Program carried out under the Appeals Programs Operations Directorate of the Appeals Branch. The Taxpayer Relief Program accepts and reviews relief requests from taxpayers.
• Taxpayers can submit a relief request electronically using the “Request relief of penalties and interest” service in My Account, My Business Account or Represent a Client, or by completing form RC4288 and sending it by mail.
• The Taxpayer Relief Program validates the relief request. A request is invalid if it was received outside the legislated time limitation or there are no provisions (legislation) to allow the CRA to consider it.
• The program reviews the request to determine if relief of penalties and interest is warranted when a taxpayer is unable to comply with their tax obligations due to circumstances beyond their control. Decisions are communicated to the taxpayer in writing.
•  The division provides cross-functional leadership and supports stakeholder branches by offering broad policy guidance and oversight on how to apply the taxpayer relief provisions.
• Revenu Québec administers taxpayer relief provisions relating to GST/HST accounts on behalf of the CRA for residents of Québec. The Taxpayer Relief Division is currently working with the Service, Innovation and Integration Branch to update procedures within an existing Memorandum of Understanding that delegate Revenu Québec to administer the taxpayer relief provisions for the CRA.
• The CRA is responsible for the administration of certain relief measures within the Customs Act. The CRA and the Canada Border and Services Agency are in discussion to develop an information exchange to share relevant information on relief requests. An information sharing agreement is in progress and this initiative will be assessed in a future update to the Privacy Impact Assessment (PIA).

Scope of the Privacy Impact Assessment

The scope of the Taxpayer Relief Program includes requests for penalties and interest relief received from taxpayers. The CRA can also waive or cancel penalties and interest without a taxpayer-initiated request when it is clear and evident that the taxpayer’s situation warrants relief. Revenu Québec employees who access CRA systems for processing GST/HST relief requests are regulated by agreements and security protocols for information sharing. These activities are in scope of the Taxpayer Relief Program but will be assessed in the next update of the PIA.

In addition, certain specialized penalties and interest workloads, such as requests associated with a voluntary disclosure, are outside the scope of this PIA.Requests for a refund or reduction in amounts payable beyond the normal three-year period and requests to accept late, amended, or revoked elections are also outside the scope of this PIA. 

Risk identification and categorization

A) Type of program or activity

Administration of Programs / Activity and services 

Level of risk to privacy: 2

Details:

The CRA administers legislation, commonly called the taxpayer relief provisions, that give the CRA discretion to cancel or waive penalties and interest when taxpayers cannot meet their tax obligations due to circumstances beyond their control. These can include financial hardship, actions of the CRA such as delays, extraordinary circumstances such as illness, and other circumstances beyond the taxpayer’s control.

B) Type of personal information involved and context

Social insurance number, medical, financial or other sensitive personal information and/or the context surrounding the personal information is sensitive. Personal information of minors or incompetent individuals or involving a representative acting on behalf of the individual. 

Level of risk to privacy: 3

Details:

The completion of a taxpayer relief file could involve reviewing personal information including medical or financial information for a spouse, child, other dependent, other relative, director of a corporation, or an authorized representative.

C) Program or activity partners and private sector involvement

With provincial and/or territorial and/or indigenous and/or municipal government(s) 

Level of risk to privacy: 3

Details:

For the most part, the information within the CRA is collected [GL1] [HS(i2] from other programs and activities such as the income tax returns programs.  

The Taxpayer Relief Program shares request[GL3] [HS(i4] s for relief on GST/HST accounts located in the province of Quebec with Revenu Québec since they administer those cases on behalf of the CRA.

Procedures to eventually share personal information with the Canada Border and Services Agency to address relief requested under the Customs Act are in development.

The taxpayer relief program is expected to eventually become paperless. However, if paper documents containing personal information are created, they will be stored by a third party in the private sector. The third-party request for proposal and contract was reviewed to clearly identify and address privacy related requirements.

D) Duration of the program or activity

Long-term program

Level of risk to privacy: 3

Details:

The Taxpayer Relief Program will continue as long as the sections for taxpayer relief provisions are included in law. It is a long-term program with no end date.

E) Program population

The Taxpayer Relief Program affects certain individuals for external administrative purposes.

Level of risk to privacy: 3

Details:

The Taxpayer Relief Program is available to taxpayers who are unable to comply with their tax obligations due to circumstances beyond their control.

F) Technology & privacy

1. Does the new or modified program or activity involve the implementation of a new electronic system, software or application program including collaborative software (or groupware) that is implemented to support the program or activity in terms of the creation, collection or handling of personal information?

Risk to privacy: Yes

2. Does the new or modified program or activity require any modifications to IT legacy systems and/or services?

Risk to privacy: No

3. Does the new or modified program or activity involve the implementation of one or more of the following technologies?

Enhanced identification methods - this includes biometric technology (i.e. facial recognition, gait analysis, iris scan, fingerprint analysis, voice print, radio frequency identification (RFID), etc.) as well as easy pass technology, new identification cards including magnetic stripe cards, "smart cards" (i.e. identification cards that are embedded with either an antenna or a contact pad that is connected to a microprocessor and a memory chip or only a memory chip with non-programmable logic).

Risk to privacy: No

Use of Surveillance - this includes surveillance technologies such as audio/video recording devices, thermal imaging, recognition devices, RFID, surreptitious surveillance/interception, computer aided monitoring including audit trails, satellite surveillance etc.

Risk to privacy: No

Use of automated personal information analysis, personal information matching and knowledge discovery techniques - for the purposes of the Directive on PIA, government institutions are to identify those activities that involve the use of automated technology to analyze, create, compare, identify or extract personal information elements. Such activities would include personal information matching, record linkage, personal information mining, personal information comparison, knowledge discovery, information filtering or analysis. Such activities involve some form of artificial intelligence and/or machine learning to uncover knowledge (intelligence), trends/patterns or to predict behavior.

Risk to privacy: No

G) Personal information transmission

The personal information is transmitted using wireless technologies. 

Level of risk to privacy: 4

Details:

Most employees of the Taxpayer Relief Program work in a hybrid work environment which requires the use of wireless technologies to connect to local home-based networks and then to the CRA secure Virtual Private Network (VPN).

Taxpayers and/or their representatives can submit their relief request electronically using the My Account, My Business Account, and Represent a client secure online portals by completing form RC4288 and sending it by mail. In the event of a natural or human-made disaster, they can request relief by calling a CRA contact centre. The CRA stores the protected information in various secure CRA systems and databases. 

Taxpayers may request information in alternate formats. Acceptable formats include electronic versions and accessible media such as disk, CD, and USB key. Visually impaired persons may register with the CRA to receive their mail in alternate format such as braille, electronic text, large print, and digital audio.

When the Taxpayer Relief Program communicates with Revenu Québec, encrypted emails are always used to ensure proper protection of the information.

H) Potential risk that in the event of a privacy breach, there will be an impact on the individual or employee

Details:

The sensitivity of information used in the taxpayer relief process is considered high (Protected B). Unauthorized use or disclosure of this information could result in a security breach, loss of privacy, misuse of personal information by unauthorized parties, identity theft, personal financial harm and/or embarrassment to the taxpayer.