2019-0824301M4 Completion of information slips

Principal Issues: Details of the legal requirement to complete information slips (e.g., T3, T5)

Position: Required to complete the information slip. Remitting incomplete forms could result in a penalty. If an error is found, it should be corrected.

Reasons: Section 162 of the Act, subsections 201(1), 201(2) and 204 of the Income Tax Regulations

Author: Clarkson, Julia
Section: Section 162 of the Act, sections 201 and 204 of the Income Tax Regulations

October 24, 2019

XXXXXXXXXX

Dear XXXXXXXXXX:

Mr. Bob Hamilton, Commissioner of the Canada Revenue Agency (CRA), has asked me to reply to your correspondence of August 29, 2019, requesting information about the legal obligations concerning the preparation and correction of names and social insurance numbers provided on T3 and T5 slips.

I note your comment that you did not receive a reply to your correspondence of June 10, 2019, addressed to Mr. Hamilton. Unfortunately, there is no record of the CRA or Mr. Hamilton receiving your letter.

Section 201 of the Income Tax Regulations requires a person making payments to Canadian resident investors to file Form T5SUM, Return of investment income, and Form T5, Statement of investment income (slip). Section 204 contains similar rules for income and other amounts allocated or paid from a trust. The required forms for these amounts are Form T3RET, T3 Trust Income Tax and Information Return, and Form T3, Statement of Trust Income Allocations and Designations (slip).

The preparer of these information slips must fill in all the required information. This includes the name, address, and identification number (social insurance number or business number) of the recipient of the slip as well as the applicable income amounts.

If the slip preparer does not include all the required information, the preparer could be liable to a penalty under subsection 162(5) of the Income Tax Act unless the preparer has made a reasonable effort to obtain the information.

If a preparer becomes aware of an error on a form that they have issued, the preparer should amend or cancel the form, whichever is appropriate, to correct that error. You can find information on how to amend or cancel T3 slips in Guide T4013, T3 Trust Guide 2018, available at canada.ca/en/revenue-agency/services/forms-publications/publications/t4013. You can find information on how to amend or cancel T5 slips in Guide T4015, T5 Guide - Return of Investment Income 2018, available at canada.ca/en/revenue-agency/services/forms-publications/publications/t4015.

Canada’s tax system is based on the principles of self-assessment and voluntary compliance. The reporting of payments on information slips is an important part of this system. Information slips help recipient taxpayers report the correct amount of income on their income tax and benefit returns.

I appreciate the opportunity to respond to your concerns and trust the information I have provided is helpful.

Sincerely,

Geoff Trueman
Assistant Commissioner
Legislative Policy and Regulatory Affairs Branch

Prepared by:
Julia Clarkson
613-670-9089

All rights reserved. Permission is granted to electronically copy and to print in hard copy for internal use only. No part of this information may be reproduced, modified, transmitted or redistributed in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, or stored in a retrieval system for any purpose other than noted above (including sales), without the prior written permission of Canada Revenue Agency, Ottawa, Ontario K1A 0L5.

© Her Majesty the Queen in Right of Canada, 2019

Tous droits réservés. Il est permis de copier sous forme électronique ou d'imprimer pour un usage interne seulement. Toutefois, il est interdit de reproduire, de modifier, de transmettre ou de redistribuer de l'information, sous quelque forme ou par quelque moyen que ce soit, de façon électronique, mécanique, photocopies ou autre, ou par stockage dans des systèmes d'extraction ou pour tout usage autre que ceux susmentionnés (incluant pour fin commerciale), sans l'autorisation écrite préalable de l'Agence du revenu du Canada, Ottawa, Ontario K1A 0L5.

© Sa Majesté la Reine du Chef du Canada, 2019