webtip

U.S. Citizens – Non-Compliance Risks Losing Passport

On December 4, 2015, U.S. President Barack Obama signed an extensive Highway Construction Bill into law. Included in the Bill were changes impacting the issuance of passports, discussed in a December 14, 2015 article (Beginning January 1, 2016: File your US tax return or risk losing your US passport, by Kevin Kirkpatrick JD, MBA). Commencing January 1, 2016, the State Department will be able to deny or revoke passports to U.S. citizens meeting one of the two following criteria:

  • Having a “seriously delinquent tax debt”, typically balances owing of $50,000 or more, including penalties and interest, although the requirements are ambiguous.
  • Having no Social Security Number associated with their passport.

For further information see VTN Monthly Tax Update Seminar, Issue No. 413

Political Activities Review – Over

The Minister of National Revenue Diane Lebouthillier has announced the winding down of the review by CRA of registered charities political activities. Throughout the project, 30 audits were completed, 5 resulted in revoked registration but were based primarily on factors beyond their involvement in political activities. The 24 audits underway at the time of the announcement on January 20, 2016, will continue, but no other entities will be reviewed under this project.

For further information see VTN Monthly Tax Update Seminar, Issue No. 415

Travel Information – Government Information and Advisories

The Government of Canada provides online travel information at www.travel.gc.ca to over 220 nations worldwide. It provides country-by-country information and advice on security, entry and exit information, health, laws and culture, natural disasters and climate, and assistance while travelling in the respective countries.

It addition, it publishes travel advisories for Canadians travelling and living abroad. These advisories are updated nearly daily. The website also notes that if the country an individual is visiting is subject to a travel advisory, travel health insurance or trip cancellation insurance may be affected.

For further information see VTN Monthly Tax Update Seminar, Issue No. 415

REQUIREMENT TO PROVIDE ACCOUNTING INFORMATION TO CRA

In an October 30, 2015 Federal Court case (M.N.R. vs. Amdoc Canadian Managed Services Inc., T-1018-15), the Minister applied for an Order (Section 231.7) requiring the taxpayer to provide the Minister with any access, assistance, information and documents available under Section 231.1 with respect to a transfer pricing audit, domestic audit, and a foreign accrual property income audit.


CRA issued 16 queries to the taxpayer. The taxpayer did not respond to three queries, explaining that the information was not within its possession, power or control.

Taxpayer wins
The Court noted that the taxpayer did not possess nor have the power to acquire the information requested by the Minister, even if it existed elsewhere. The Tax Act does not contemplate the creation of records where they do not exist; that which does not exist cannot be produced.

For further information see VTN Monthly Tax Update Seminar, Issue No. 412