Is the CRA Looking After Your Best Interest? Theirs? Or No Ones???

I have always felt that the Canada Revenue Agency (CRA) does an adequate job at what they are mandated to do, and that is to collect tax revenue and tax information from taxpayers while using their debt management (collections) division to collect from the unwilling or pre-occupied.

From the inside you are trained to understand that those who do not file or pay are “debtors” and that actions should be taken to bring these debtors into compliance right away.

You are also trained that if you can collect from – or force into bankruptcy – these individuals and corporations, that you are doing them a service but forcing them to make decisions that they are unwilling to make or unable to make.

Those of us who have worked in the “real world” understand that behind the account numbers and names there are real people who are trying to run real businesses and who find taxation either complicated or overbearing and cannot comply with the rules and regulations.

Since failure to comply can result in criminal actions, I believe that the tax rules are complicated and with little forgiveness on the party of the government, one small mistake can shut a business down, or result in significant monetary penalties.

The most frustrating part, I find, is trying to explain to the CRA that their actions – while justified internally – have serious implications on more than a business or a person.

Take for example one of my clients;

I spent the last week in serious discussions with just about everyone at the Winnipeg Tax Services Office, trying to convince then that if they keep a garnishment on a corporate bank account that they will shut down this corporation.

The corporation’s issue, which the collector, team leader, technical advisor, section manager and director felt justified these actions?

They were in collections for 2-years. They had a trust exam and fell behind.

GASP.

I mentioned the accounts I am resolving for them right now involving people and corporations in collections for 15-20 years. 2-years is a drop in the bucket.

I also let them know of the tragic circumstances surrounding this corporation involving a death, an illness and a mass exodus of employees which left one director now trying to keep his corporation alive. That was until the CRA placed the garnishment and wanted to shut down the corporation.

So the collector – new – and the technical advisor – new – find words to justify their actions and the director did not return my calls or letters (yet, apparently) did not feel compelled enough to get back to me and intervene.

The CRA’s solution instead of putting 3 employees out of jobs, and a family man without income to support his young family was to drag out the process and ask for a payment arrangement on a corporation with no income… From their actions.

So whose interests are the CRA looking after?

Theirs? Nope. By not allowing the corporation to operate and earn income they are going to lose out on revenue to pay their liability. When they do open up the account, the corporation will need to pay back rent, phones, internet, and buy stock before either paying themselves or the CRA.

Are they looking after the corporations interests? Heck no! By not being able to operate and by stringing along the director, this corporation is bleeding a slow death. Customers are losing faith, employees are quitting and with no money, the corporation cannot afford to fight any more.

So it is very clear at this point that the CRA is looking after no one’s interests. Their actions are destructive and they are too far from the real world to understand that in this case no action is the very best action.

Frustrating?

Absolutely.

So after one whole week of trying to talk sense into the CRA, I am hopeful that the garnishment comes off the account today. The CRA will get a plan on how this corporation plans to recover from a poorly executed collection actions which will get them one payment and nothing for at least a month.

The end game here will benefit everyone now that I am involved, but my job would be so much easier if the CRA understood that they need to listen to the experts and let the account resolve itself.

I would be so much father ahead than we are now and the poor director would have slept at least one night in the past month instead of trying to figure out why the CRA is trying to shut them down.

I’m looking out for the corporation’s best interests!

Someone has to!

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Author: Warren Orlans

Welcome to inTAXicating. My name is Warren Orlans and this is my blog. With over 17-years experience in the taxation industry, 11 of them working for the Canada Revenue Agency (CRA), and the rest working in the private sector at large financial institutions responsible for resolving tax issues for corporations and individuals and the Canadian lead for a large US bank on FATCA implementation. My tax career began pretty much out of university at the CRA, in Collections, where I moved up, across, over and up again through their division with stops in Enforcement, Taxpayer Relief (then Fairness), Audit, Directors Liability, Training, Mentoring, GST, GST/HST, Payroll, Corporate Tax, Personal tax, and probably much more. If you have a collections, compliance or audit issue with the CRA, inTAXicating is the place you need to contact. inTAXicating works in strategic partnership with amazing tax lawyers, insolvency practitioners, mortgage brokers, debt counselling experts and much more. When dealing with governments, knowledge is power. We possess strong understanding of government so we know what the next step is before the government does. When you have a collections problem with the CRA, do you hire a graphic artist? No, you get a former collector who trained the staff, and who worked as a resource officer for 5 years. Then you know you are on the right track to resolving your tax problem(s). Others offer suggestions. We offer solutions! info@intaxicating.ca

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