Valid Voluntary Disclosures
A valid voluntary disclosure is defined by the following four conditions:
(a) The CCRA determines that the disclosure is voluntary.
The disclosure must be voluntary. The client has to initiate the voluntary disclosure. A disclosure may not qualify as a voluntary disclosure under the above policy if it is found to have been made with the knowledge of an audit, investigation, or other enforcement action that has been initiated by the CCRA, or other authorities or administrations with which the CCRA has information exchange agreements.
(b) The CCRA determines that the disclosure is complete.
The disclosing client is expected to provide full and accurate reporting of all previously inaccurate, incomplete, or unreported information. After initial discussions with the client, the VDP officer may request certain documentation to verify the amounts to be disclosed. The disclosing client is expected to comply with such requests and to provide enough detail to allow the facts of the case to be verified. The CCRA will determine whether a disclosure is complete according to the terms of the disclosure originally presented to the client by the CCRA. While the information provided in a disclosure must be substantially complete, a disclosure will not be disqualified simply because it contains minor errors or omissions. However, if a disclosure is found to contain material errors or omissions, the disclosure will not qualify as a voluntary disclosure, with the result that the disclosed information would be processed and interest and penalties can be applied to the entire amount.
(c) The disclosure involves a penalty.
A disclosure must involve at least one penalty. If no penalties apply to the information being disclosed, the client does not need to seek penalty relief through the VDP. This information should still be provided to the CCRA and will be processed, as would any other request for adjustment.
(d) The disclosure must include information that is:
(i) at least one year past due, or
(ii) if less than one year past due, not initiated simply to avoid the late filing or instalment penalties. (Income Tax Act and Excise Tax Act)
The VDP is not intended to act as a vehicle for clients to intentionally avoid their legal obligations under the acts administered by the CCRA. For example, a client cannot use the VDP to disclose a current year income tax return simply to avoid paying the late-filing penalty.
For purposes of the Customs program, the disclosure must affect the accounting and payment of duty and/or tax. (Customs Act and Customs Tariff)
