What is the CRA Voluntary Disclosures Program?
It is the route for correcting something you got wrong or never filed — unreported income, an unfiled return, a foreign holding that was never disclosed — before the CRA comes to you about it. Where an application is accepted, relief is available from penalties and from part of the interest that would otherwise be charged. The tax itself remains payable. The word that carries the weight is voluntary: the route exists only while the CRA has not already begun enforcement action on the matter, so the value of the programme decreases with every week it is put off.
Will the CRA still accept a disclosure if they have already written to me?
It depends entirely on what the letter is. Correspondence that amounts to enforcement action relating to the matter you want to disclose can take the disclosure out of the programme, because the disclosure is then no longer voluntary. A general letter, a routine notice or an enquiry about something unconnected does not necessarily have that effect. This is why the first piece of work is reading the actual correspondence rather than the description of it, and establishing eligibility, before anything is submitted. Bring every letter received, including the ones that looked unimportant at the time.
Should I just file the late returns instead of applying?
This is the most expensive mistake made in this area, and it is made in good faith. Filing the outstanding returns on your own initiative can put the matter before the CRA in a way that closes the disclosure route that was available the day before, because the information is no longer coming forward as a disclosure. The relief is then gone and the tax is still owed. Eligibility is assessed before anything is filed, and the filings are prepared to go in as part of the disclosure rather than ahead of it. The order of operations is the whole point.
Does the programme cover unreported foreign accounts and property?
Unreported foreign income and undisclosed foreign holdings are among the most common subjects of a disclosure, and the reporting failures often extend across several years because the obligation is annual and recurring. Two complications turn up repeatedly in cross-border files. The threshold that triggered the reporting is frequently measured differently from the equivalent figure in the other country — cost against market value, calendar year against fiscal year — so a taxpayer can be genuinely compliant abroad and non-compliant here on the same facts. And the foreign filings often need their own correction in parallel.
Will I still owe interest if my disclosure is accepted?
Expect to pay tax and some interest. Acceptance brings relief from penalties and from part of the interest, not all of it, and the relief available generally depends on how far back the years go. So the arithmetic to do before applying is the tax, plus the interest that will survive the relief, against the penalty exposure and the interest that will not. The other half of the planning is cash: a disclosure covering several years produces a single liability that arrives more or less at once, and the payment arrangement is worth raising at the outset rather than after the assessment.
Does an American catch-up filing fix my Canadian returns as well?
No. Each country runs its own routes for coming forward, on its own eligibility conditions and its own relief, and the fact that you have regularised your position in one country does nothing for the other. Both sides do need to be planned together, though, because the disclosures have to tell the same story. The income figures, the account balances and the years covered should reconcile between them, with any difference in measurement basis explained. Two catch-up filings prepared in isolation is how a taxpayer ends up contradicting themselves in front of two tax authorities.
Do dual citizens have to file US taxes if they live abroad?
Yes. US filing follows citizenship, not residence or where the income arose, and the obligation continues for as long as the citizenship does. Two further obligations travel with it and are keyed to account balances rather than income, so they can apply in a year with no US tax at all: the foreign bank account report to FinCEN, and the specified foreign asset statement with the return. Most people who discover a problem discover it there. See two returns as a dual citizen.
Can an accountant in one country file my return in another?
Yes, where they are authorised to represent you with that tax authority and the filing is done electronically. What matters is not where the adviser sits but whether they can lawfully act for you and are competent in both systems — a return prepared with no knowledge of the other country is where the relief gets missed. We file on both sides, from offices in India, the USA, Canada and the UAE. See how we work.
