How will the CRA strike impact income tax filing for Canadians?

On Wednesday April 19 at midnight, 39,000 employees at the Canada Revenue Agency (CRA) went on strike — two weeks before the deadline for Canadians to file their income taxes, on May 1.

Here’s what you need to know about the CRA strike and how it will affect you this tax season.

The Public Service Alliance of Canada-Union of Taxation Employees (PSAC-UTE) is the union that represents workers at the CRA. The PSAC-UTE has been in an ongoing dispute with the Treasury Board over proposed wage increases and protections for remote work in their new contract.

Currently, CRA employees earn between $45,000 and $60,000 annually, and claim they’re struggling with the current cost of living amid rampant inflation, which hit 8.1% in June 2022, marking a new 39-year high.

While inflation has since come down significantly since then — to 4.3% last month — the CRA’s contract with the Treasury Board expired in June of 2021, meaning that wage increases being negotiated now are reflective of inflation rates over the past three years. Where it stands, the Treasury Board is offering workers an increase of 9% while the PSAC-UTE is asking for an increase amounting to 22.5% over three years.

The CRA will continue to accept tax filings during the strike. However, it will be stockpiling paper tax returns until both sides reach an agreement. So, to ensure tax benefits are returned in a timely manner, the CRA is encouraging people to file their taxes electronically since these are processed automatically.

To file your taxes electronically, you can use an online tax software, web browser, or mobile app. If you signed up for My Account, you can use the CRA’s NETFILE certified software, which can autofill your tax information. If you don’t know how to file your taxes, there are many free online clinics available through community organizations.

Yes. While there has been pressure from accountants and taxpayers to extend the tax deadline because of the CRA strike, no extension has been granted.

The deadline for most Canadians to file their taxes is still May 1, 2023, or June 15, 2023 for those who are self-employed or have a spouse or common-law partner who is.

If you don’t file and pay your taxes on time, you’ll be subject to an immediate penalty of 5% of your tax balance, plus an additional 1% for each subsequent month that your payment is delayed for up to 12 months. For example, if your balance is $1,000, you will be charged an immediate penalty of $50 plus an additional $10 for each month that your payment is late.

If you file your taxes electronically, your tax return should be processed automatically without delay. However, if you file your taxes by paper, the CRA says there will likely be delays in processing.

As a result, the CRA is encouraging all Canadians to file their taxes electronically this year.

During the CRA strike, Canadians can still access the agency’s online services to maintain their tax affairs. If you run into any issues, contact centre services are still running but be prepared for longer wait times than usual.

During the strike, benefits and credits, such as the Canada child benefit, GST/HST credit, and climate action incentive payment, will be issued as usual.

Visit the CRA website for a full list of services that will and won’t be operational during the strike.