The Canada Revenue Agency (CRA) is running behind on amending information related to individual Tax Free Savings Accounts (TFSA). As a result, the Investment Industry Association of Canada (IIAC) has obtained a 90-day extension for dealers to get their records in order.
In a blog post last week, IIAC president and CEO Ian Russell noted that if the personal information that an investment dealer has on file for a TFSA account holder does not match the CRA's records, the dealer is obliged to correct the data and resubmit the amended record. If investment dealers are unable to do this, they must nullify the account and issue a tax slip to the client.
The CRA had set Feb. 29, 2016 to be the final day for correcting TSFAs, but the tax authorities have been slow to process the outstanding backlog of amended individual records.
"Consequently, IIAC Member firms were not informed by the deadline whether the changes made were accepted or rejected by the CRA. The IIAC requested and obtained a 90-day extension for dealers to reconcile records," writes Russell. "This is a significant benefit for the clients of IIAC Member firms as it will result in fewer account nullifications and tax slips issued."