Tax Tips & Pits

Tax Tips & Pits: Canada Revenue Agency’s push to go paperless

There are two sides to any budget – revenues and expenses.

There are two sides to any budget – revenues and expenses – so this month as the government asks you to pay your taxes in order to collect revenue you should be pleased to know they are also asking you personally to help decrease government expense.

Canada Revenue Agency (CRA) this year is asking taxpayers when they file their tax return if they wish to consent to on-line mail instead of receiving CRA letters through Canada Post – an ironic tidbit when one considers that CRA is one of the most frequent users of Canada Post … as Canada Posts struggles to be profitable.

But I digress.

If you agree to the question on your tax return to have CRA email you messages, you will have to set up “My Account” on-line with CRA.  A simple process to do, but once again with a twist of irony, when you initiate the set up of your “My Account” CRA mails a passcode to you – yes, CRA uses Canada Post to get your secret code to you.

If you already have “My Account” set up with CRA, you can save CRA that passcode letter (but cost Canada Post) because you can give your consent to CRA directly on-line through your “My Account”.

So how’s email communication going to work?

CRA is assuring the public that information will remain private and be secure.  To this end, CRA emails will not contain personal information nor detail, will not ask you to respond to the email, will not include links to the CRA website nor any other website, and will not have any attachment to open.

What CRA will send in their email is a message telling you to check your on-line CRA “My Account” for a message.

And what kind of messages will await you once you log into your “My Account”?  Despite the fanfare of this move to go paperless and save taxpayers lots of money, at this time apparently only Notice of Assessments and Reassessments will be there for your perusal – these are the confirmation letters sent after filing a tax return.

In fairness, CRA promises eventually most every communication they have with taxpayers will be paperless – and I don’t think this implies CRA will be hiring more staff to make personal phone calls to taxpayers.  Instead, perhaps one day a barrage of CRA messages will greet you each day in your in-box.

A second paperless push by CRA at this time is the request of taxpayers to set up direct deposit for payments from government.

Now if you ever want people to buy into something, offer them money or at least offer them their money faster. Speaking from experience, asking people to consent to direct deposit versus consenting to email communications is about a 10 to 1 ratio – go figure.

By the way, CRA has promised a mobile app for smart phones soon. Here’s a marketing tip, pay people to use it.

Ron Clarke has his MBA and is a business owner in Trail, providing accounting and tax services. Email him at ron.clarke@JBSbiz.ca. To read previous Tax Tips & Pits columns visit www.JBSbiz.net.

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