For the fifth year in a row, the CRA is conducting what it calls a “letter campaign”. We often refer to it with our clients as a “fishing” expedition. At the beginning of the year, the CRA sends about about 33,000 letters to randomly selected taxpayers who claim business or rental losses or are employees who claim employment expenses on line 229 of their income tax return.
These letters are basically sent out as a method of getting taxpayers to “self-audit”. They are intended to be “educational” in nature, however we find many of our clients get quite concerned over the contents as the wording can make it seem as if the taxpayer has done something incorrect, when in fact this is not the case. If you receive this letter, you “won the lottery” so to speak, and no action on your part is normally required. While it provides an opportunity to double-check your work to ensure everything is being correctly reported, there is no need to panic.
As we’re sure you can see, this is an inexpensive way for the CRA to collect additional tax revenues with a minimal of effort and cost on their part.
More details about the campaign can be found here: http://www.cra-arc.gc.ca/lettercampaign/
If you have any questions at all, feel free to contact our office.Tags: cra, letter campaign