Canadian Foreign Assets above 100K declaration

[beerbaron]

Hi, I just got a letter from the Canadian Revenu Agency asking me for 950$ + interest because I declared my T1135 two months late. This is the first year that my forign assets went over 100K and got a newborn on April 2nd, hence had other business to atend to besides doing my taxes (usually the governement owes me money so I never pay interest).

 

It seems like a VERY severe penalty for failure to file on time, especially considering it was my first time filing. Anybody else had this issue and were you able to settle with the CRA for a lesser amount?

 

Thanks

BeerBaron

[rb]

I'd say that first thing is to check whether your foreign assets are over 100k and you were indeed required to file a T1135. Form T1135 is required if the assets had a cost in excess of 100k, not a market value in excess of 100k. I mention it because a lot of people get that wrong.

 

If you were indeed required to file the form you are indeed in a bit of a pickle. Your only way of avoiding the penalty is to beg forgiveness of the CRA. Which is to apply for relief. Usually with the CRA you generally are allowed one screw up, so the first one's free. Unfortunately in your case the CRA is dead serious about form T1135. So I'd say your chances of getting relief are around 50/50. But it's worth the shot.

 

It should go without saying that you should be professional and courteous in asking for relief.

[beerbaron]

Thanks a million for the tip about the calculation being made on a cost basis. Turns 100K+ into 60K :) I'm so glad to be out of this shylock type of fine.

 

BeerBaron

[John Hjorth]

Great to read about such valuable help among a couple of canucks here on CoBF, and congratulations on the family extension to BeerBaron!