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What is Voluntary Disclosures?

July 8, 2014

Tax Question:

What is the Voluntary Disclosure Program and how can it help me?


Tax filings can be complicated and occasionally you may miss a filing or make an incomplete or inaccurate filing or overlook information or returns that should have been filed. The Voluntary Disclosure Program (VDP) is administered by Canada Revenue Agency (CRA) to encourage taxpayers to comply with Canada’s tax laws without incurring penalties for missed, incomplete and inaccurate filings.


By making a valid disclosure under the VDP, you would pay only the taxes and interest owed and you may avoid any penalties or potential prosecution on the information disclosed. There are many types of information that you can disclose to CRA such as:

  • Unreported personal or business income
  • Unreported source deductions
  • Late filed income tax returns
  • Late filed information returns
  • Expenses you were not entitled to claim

To be accepted as a valid disclosure under the VDP, your submission must meet all of the following four conditions:

  • The disclosure must be voluntary (you must make the disclosure before CRA noticed and commenced an action against you with respect to the information you are disclosing)
  • The information disclosed may involve a penalty
  • The disclosure must include information that is generally more than one year overdue
  • The disclosure must be complete. It must include all appropriate information to support the disclosure

You cannot make a disclosure more than once on the same issue. For example, if you have missed a T1135 Foreign Income Verification Statement in a previous year and made a valid disclosure for this missed filing under the VDP, you cannot use the VDP at a later date to file another missed or incomplete T1135. Therefore, you want to use this program carefully and ensure that you disclose all incomplete or late filings on the same issue as one submission under the VDP and then be very diligent and thorough with your filings around this issue in subsequent years.

If you would like more information on this topic, please contact a member of the Empire CPA team by filling out the contact form below.

Canadian and foreign tax laws are complex and have a tendency to change on a frequent basis. As such, the content published above is believed to be accurate as of the date of this post. Before implementing any tax planning, please seek professional advice from a qualified tax professional. Empire, Chartered Professional Accountants will not accept any liability for any tax ramifications that may result from acting based on the information contained above.

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