Scary: Financial Literacy at CRA

It’s Halloween week and Financial Literacy Month is just around the corner, right after the ghosts and goblins visit. Just in time too, because it turns out it’s not just your imagination: communications from CRA are somewhat ghoulish.

It’s been confirmed by New York consulting firm, Siegelvision, which was paid $25,000 by CRA to check up on the clarity of its communications with taxpayers. It found:

  • “information (from the CRA) was not well organized,
  • presentation of information did not inspire confidence,
  • tone used lacked empathy,
  • the main purpose of the documents was (often) not readily apparent, and
  • important information was scattered throughout the document or embedded in dense paragraphs.”

The CBC reported on the story this morning, citing several other reports, including a 2012-2013 study from the Walker Consulting Group which found that taxpayers they interviewed considered the letters and notices from CRA to be so full of unintelligible messaging that they did not understand what, or how much, CRA wanted from them. It’s a reality the new Financial Literacy leader may wish to weigh in on, as Canada’s national strategy on Financial Literacy is developed.

The cost of all the gibberish is an expensive follow up system with taxpayers who contact the agency to find out what they are being asked for. That’s problematic, too. With recent staff cuts, those files can sit unanswered for months. Meanwhile, taxpayers will continue to see rising monthly compounding interest charges on overdue balances — real or requiring adjustment — making the eventual reconciliation of the original problem even more incomprehensible.

CRA’s answer to all of this, for now, includes a plan to consult businesses this fall for feedback and then to allow individuals to receive online correspondence starting in February of the new year.

And that’s perhaps where the connection to Halloween comes in: regardless of how invisible or unintelligible the correspondence from CRA may be, the onus is still on the taxpayer to comply with the CRA or face the financial consequences. The good news? You may request a cancellation of interest or penalties using Form RC4288, and other Taxpayer Relief, if required.

It’s Your Money. Your Life. Don’t get spooked by CRA messaging. If you are having trouble deciphering either hard copy or soft, contact a DFA-Tax Services Specialist immediately to get to the bottom of it.

Evelyn Jacks is President of Knowledge Bureau and author of 51 books on tax and personal wealth management. Meet Evelyn on the Year-End and Business Succession Planning Bootcamp tour this November. Follow Evelyn on Twitter at @EvelynJacks.

Leave a Reply

Your email address will not be published. Required fields are marked *