Voluntary Disclosure: Fixing Past Tax Errors

Correcting the Past Before the CRA Finds You

If you realize you missed a filing or under-reported tax from two years ago, the worst thing you can do is stay silent.

Why Use the VDP?

The CRA is much more lenient when you come to them first. Through a valid disclosure, you can:

• Avoid late-filing penalties (which can be very high).
• Avoid gross negligence penalties.
• Get relief from a portion of the interest owed.

Conditions for a Valid Disclosure

For your application to be accepted, it must:

1. Be Voluntary: You must apply before the CRA starts an audit or investigation into the error.
2. Be Complete: You must disclose all errors for that period, not just some.
3. Involve a Penalty: The error must be something that would have triggered a penalty.
4. Be past due: For many late-filed return cases, the filing is expected to be at least one year overdue.

How to Apply

You must submit Form RC199, Voluntary Disclosures Program Application. We strongly recommend consulting a tax professional before submitting, as the disclosure is legally binding.

Recalculate historical transactions before voluntary disclosure filing →

FAQ: Voluntary Disclosure

Can I use VDP for a current year error?

No, the VDP is for "past" errors. For a recent mistake (within the current filing cycle), you should just "Amend" your return in My Business Account.

Is my disclosure confidential?

The CRA will use the information to update your tax records, but you are protected from the negative legal consequences you would have faced if they had caught the error first.

Sources

• CRA: Voluntary Disclosures Program (IC00-1R6)
• CRA Form: RC199 - Voluntary Disclosures Program Application