INTERNATIONAL TAX PLAZA - Canada Revenue Agency’s Electronic Funds Transfer (EFT) initiative is launched

(January 8, 2015)

On January 7, 2015 The Canadian Government issued a news release stating that on January 7, 2015 the Honourable Kerry-Lynne D. Findlay, P.C., Q.C., M.P., Minister of National Revenue, announced the launch of the Canada Revenue Agency’s (CRA) Electronic Funds Transfer (EFT) initiative. The initiative was introduced in Economic Action Plan 2013 as one of several new measures that aim to crack down on international tax evasion and aggressive tax avoidance.

The news release states that effective January 1, 2015, certain financial intermediaries, including banks, have to report to the CRA incoming and outgoing international EFTs of CAN $10,000 or more. The goal of these reports is to allow the CRA to better identify higher risk taxpayers and files and, in turn, more effectively identify taxpayers who participate in international aggressive tax avoidance and attempt to conceal income and assets offshore.

According to the news release the new reporting requirements are the same as those for reports currently provided to the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC). Financial intermediaries will submit one report to both FINTRAC and the CRA at the same time. EFTs must be filed no later than five working days after the day the transfer occurred.

The news release further states that information that must be reported includes the transmission of instructions for a transfer of funds through any electronic, magnetic or optical device, telephone instrument or computer, made at the request of a client.

According the news release the following financial intermediaries will be submitting EFT reports:

· Financial entities (banks; credits unions; caisses populaires; financial service cooperatives; trust and loan companies; and crown corporations that accept deposits)

· Money service businesses (MSBs); and

· Casinos

Some more information on the EFT initiative can be found on the website of the Canadian Revenue Authority. Click here to be forwarded to the website of the Canadian Revenue Authority.

For further information click here to be forwarded to the news release as published on the website of the Canadian Government.

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