The "Voluntary Disclosure Program" (VDP) refers to the Canadian Revenue Agency's (CRA) allowance to correct mistakes and incomplete or withheld information on your previous tax returns. Voluntarily disclosing this information prevents the taxpayer from being penalized or prosecuted in any way. These disclosures can be made on income taxes and goods and services taxes. The VDP promotes compliance with tax laws by allowing taxpayers to come forward to correct mistakes without penalization. However, this program is in no way meant to encourage taxpayers to intentionally avoid legal obligations regarding taxes. To prevent taxpayers from intentionally defrauding the CRA, the taxpayer must submit details of the inaccuracies with their disclosure, and the CRA must deem this claim valid.

The Voluntary Disclosure Program provides a simple way for a taxpayer to correct previous tax forms. A taxpayer may refer to an individual, a business, or a trust. The RC199 form can be found on the Canadian Revenue Agency's (CRA) website. Along with this form, disclosures need to be recorded in writing. These disclosures should be detailed, and it is always a good idea to sign the letter while witnessed by a notary public. If the taxpayer prefers, an authorized representative may make the disclosure; if the Form T1013 ("Authorizing or Cancelling a Representative") has not been submitted to the CRA, this form must also be submitted with the disclosure. With all of items necessary for the disclosure complete, it is as simple as submitting these to the taxpayer's local tax center.

The Voluntary Disclosure Program (VDP) provides a simple way for a taxpayer to correct previous tax forms. A taxpayer may refer to an individual, a business, or a trust. The RC199 form can be found on the Canadian Revenue Agency's (CRA) website. Along with this form, disclosures need to be recorded in writing. These disclosures should be detailed, and it is always a good idea to sign the letter while witnessed by a notary public. If the taxpayer prefers, an authorized representative may make the disclosure; if the Form T1013 ("Authorizing or Cancelling a Representative") has not been submitted to the CRA, this form must also be submitted with the disclosure. The taxpayer has two choices to submit the disclosure: 'name' or 'no name.' A named disclosure is a disclosure on which the taxpayer's identification is clearly stated on the initial statement. A no name disclosure is useful for taxpayers who are not sure whether they want to proceed with the VDP. A no name disclosure allows the taxpayer to communicate informally, and in a non-binding manner, with a VDP officer. A taxpayer may decide to move forward with the voluntary disclosure after this communication with the VDP officer. If the taxpayer has already submitted all required documents for the VDP, the CRA can review the disclosure and provide advice. This advice is only binding, however, if, once the identity of the taxpayer is revealed, there is no discrepancy in the information. If a taxpayer submits a no name disclosure and then decides not to proceed with the disclosure, the taxpayer still runs the risk of the CRA finding the issue in the tax return, and the taxpayer would still be liable for any penalties or prosecution levied against them. Additionally, the taxpayer is only protected from penalty and prosecution for the disclosures they have made. If there is more than one (non-correlated) inaccuracy in a tax return, and the disclosure is only made for one issue, the taxpayer may still be penalized for any other inaccuracies.

With all of items necessary for the disclosure complete, it is as simple as submitting these to the taxpayer's local tax center. While the claim is being reviewed, the CRA may request additional information. Any information not provided within the stipulated timeframe, the claim may be deemed incomplete and therefore invalid. When a claim is found to be valid, the taxpayer is still responsible for any taxes and/or charges owed. While interest is still owed, the Minister may grant partial relief for anything other than the most recent three years of returns. For income tax returns filed after 2005, there is a 10-year limitation on the relief the Minister may grant. For example, if voluntary disclosure is submitted in 2007 for a tax return filed in 1992, interest relief may only be granted for years between 1997 and 2007. However, the Minister is in no way required to grant interest relief. The Minister may make the decision to assess or not assess interest on a case-by-case basis. Claims that are not found to be valid have several options of redress. The taxpayer or authorized representative may request a second review of their file. This is done by contacting the director of the tax center where the decision was made. Should the result still be unfavorable to the taxpayer, the taxpayer is free to go through the judicial review process.