For the 2013 tax year, if a taxpayer makes a claim under a gifting tax shelter scheme the Canada Revenue Agency (CRA) will not assess taxes owed or provide a refund to taxpayers until the CRA has audited the tax shelter. If the taxpayer agrees to remove the claim from their return, the taxpayer can have their tax return assessed before the tax shelter is audited.
If a tax payer receives a charitable donation receipt for an amount higher than the value of property donated, the receipt is not valid and can not be used to claim a tax credit.
The CRA strongly recommends taxpayers to get advice from a tax professional before engaging in a tax shelter. To contact a Smythe Ratcliffe accounting professional click here.
For more information on the CRA’s administrative procedures for gifting tax shelters, view the full article here.