Canada announces mandatory corporate tax reporting via Internet

It was announced by the Canada Revenue Agency that any corporation with gross revenues exceeding $1 million will have to file their T-2 statements electronically via the internet.  This will apply to tax years ending in 2010 or be subject to fines.  The tax filing changes come into effect by the end of 2009.

This is a significant milestone investment and adoption in methodology by the Canadian Government.  The amount of paper it will save is something of an unknown because there's bound to be more than a few printed review copies prior to submission, yet this is clearly one of the goals of the government. The cost reductions (listed below) subsidize the capital investments required such as security and data storage.  File transfers are done with 3DES 256 bit encryption, better than many financial online banking transactions.

In an interview, Peter Delis of Canada Revenue Agency said the the goal is saving taxpayers the process steps that the CRA has to do with all tax returns. Opening up envelopes, reviewing documents and inputting figures by them which is duplicating the same steps already taken by the corporate customer.  Canada has had electronic (E-Filing) options since the 1999 / 2000 with significant adoption of the technology, and service.  There were approximately 24 million personal tax returns filed 2008.

In 2008, there were 14, 413,547 paper tax returns submitted and 400,000 less in 2009 as of October. Internet, including tele-filing, E-Filing (those who submit tax returns through a licenced E-Tax service provider) was up 1.1M compared to 2008, at 15,313,262.

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The future is clear: Paper submissions of tax returns will eventually disappear for corporate and personal filings. No date has been set for complete elimination of the paper option. Eventually you may not even need to file a tax return once everything is bar coded and tracked. Every deductible item in the future will probably have a bar code, which includes a segment for tax assessment!