Missing a slip on your tax return can be expensive.
T4s that you get from your employers aren’t the problem – you work all year, you’re not likely to forget you earned that income and have to pay tax on it.
But slips for investment income, including bank interest and dividends on stocks, are easier to overlook, and easier to go astray. The number and types of investment income slips you get can change from year to year, so it’s hard to know if anything is missing.
And they often do go missing, for example if you’ve moved in the year and neglected to notify every institution where you have money invested.
The first time you miss a slip it’s no big deal. CRA has copies of all your slips on file, and their matching process double checks to make sure all the amounts they expect to see on your return are there. If they notice a missed slip for the first time, they just adjust your return and taxes accordingly and send you a Notice of Reassessment to inform you of the reason for the change.
But that’s the end of the grace period. The second time you miss reporting that slip, the penalty is 20% of whatever income is on the missing slip, plus interest on the tax and penalty owing.
If you have received a notice of a missed slip, contact the issuer of the slip as soon as possible to find out what went wrong and correct it. Make sure they have your correct address in their files so nothing goes missing again.
And remember that all your slips are available from CRA, either by mail (though it can be slow) or over the phone. Have your last Notice of Assessment and/or last filed tax return handy, call CRA at 1-800-959-8281 and press * to speak to an agent.
Once the agent has asked you a few questions to confirm your identity, you can ask them to review all the slips they have on file for you.
If you’re missing any, just get them to read the box numbers and figures over the phone. That’s all your tax preparer needs in order to complete your return.