T3 Filings: Updated details on penalty relief

March 12, 2024 – Video Tax News authored item

Many practitioners have been addressing the challenges of the new trust reporting requirements, especially as they have imposed filing requirements on a vast array of arrangements commonly described as “bare trusts”.

On March 12, 2024, CRA updated Questions 3.5 and 3.6 on their FAQ webpage New reporting requirements for trusts: T3 returns filed for tax years ending after December 30, 2023.   Their new guidance indicates the following: no penalty will apply where the 2023 return (and Schedule 15) for a bare trust is filed after the April 2, 2024 deadline for reasons other than gross negligence; the gross negligence penalty will be assessed only “in the most egregious cases”; any gross negligence penalty will be assessed only in the context of a “compliance action” (e.g. an audit); and all such penalties will be subject to a mandatory review by CRA Headquarters.   This penalty relief applies only to bare trusts, and only for the 2023 T3 return.  

For more information, see: www.videotax.com/web-tips-articles/t3-filings-updated-guidance-on-relief
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