TFSA returns and payment of taxes

If you have received a return from the CRA regarding your TFSA you have until August 3 (previously June 30) to respond to the TFSA Return by either agreeing to pay the amount indicated or by making changes to your TFSA Return and sending it back to the CRA.

If you sign and return the TFSA Return (including the payment) by August 3, the CRA will assess your return based on the existing information and any new information or documentation which has been provided, by you and your financial institution(s), and issue a notice of assessment.

If you do not respond by August 3, the CRA will assess your return based on the data available and issue a notice of assessment.

A late filing penalty as well as interest may be charged if the return is received after August 3 and the tax owing was not paid on time.

Should taxpayers be filing the Fairness relief form or a Formal Notice of Objection?

No, you should not be filing the Fairness relief form or a Formal Notice of Objection.  The return does not automatically mean that you will be subject to a tax. You may need to supply additional information and are encouraged to respond to the CRA letter by providing additional information or explanations that you may have in respect of your over-contributions.

The letter you received provides instructions on how to proceed.

If no additional information is provided or you do not contact the CRA, a notice of assessment will be issued. Only at that time should you use the Fairness relief form or a Formal Notice of Objection.