August 10, 2018 6:00 am

Is a CRA internal reshuffle causing hefty delays for a minority of taxpayers?

The Canada Revenue Agency reorganized its tax processing centres in 2017. Now some taxpayers say they've been told that unusually large workloads at some centres are causing delays.

THE CANADIAN PRESS/Sean Kilpatrick
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Brad Fitzsimmons was buying diapers at Shoppers Drug Mart for his newborn daughter when his phone lit up with a call from the Canada Revenue Agency (CRA). He hastened to pick it up, but by the time he had hung up, nothing had changed.

A father of two based in Acton, Ont., Fitzsimmons said in recent months he’s been dipping into his savings instead of receiving a $24,000 tax refund.

That’s how much he was expecting after making a six-figure contribution to his Registered Retirement Savings Plan (RRSP) last year, he told Global News.

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When he received $143,000 in severance payments from his former employer last summer, Fitzsimmons thought he would put the funds into his until-then-unused RRSP, he said. He planned to use the large tax refund that would ensue to help cover expenses in 2018.

Instead, on in late July, around the time his daughter was born, Fitzsimmons received a notice from the CRA advising him that his RRSP contribution had been disallowed. He now owed $56,000.

READ MORE: CRA is experiencing ‘higher than normal volumes of work’ on tax-return reviews

The issue appears to be missing information about his RRSP contribution, something the agency flagged in late April, Fitzsimmons said. He got back with additional documentation in a few days, he added.

But communications have since been choppy and confusing with most calls going unanswered and the CRA often missing its own deadlines for replying to inquiries from both Fitzsimmons and his tax accountant.

“Since there is no answer, we have no understanding of our situation at all,” Fitzsimmons told Global News via email.

READ MORE: It’s June – where’s my tax refund?

When he did get through to CRA agents, Fitzsimmons said he was told repeatedly of delays caused by larger-than-usual workloads.

He also said one officer told him the agency had increased the volume of tax reviews conducted prior to issuing a notice of assessment, something known as pre-assessment.

Asked for comment, the CRA did not say whether it has performed more pre-assessments of individual tax returns this year compared to past years.

However, in previous communication with Global News earlier this month, the agency said it is “currently experiencing higher-than-normal volumes of work in the review programs.”

WATCH: Here’s what you should, and shouldn’t, do with your tax refund

In an email this week, the CRA added that it “streamlined” its tax-processing activities, with the creation of three so-called National Verification and Collection Centres (NVCCs).

According to the agency’s website, this is part of the CRA’s Service Renewal Initiative launched by Ottawa in 2016. The overhaul, which was meant to result in faster processing and better handling of calls to call centres, involved re-purposing three of the CRA’s nine processing centres as NVCCs.

The three centres that were converted to NVCCs are in Surrey, B.C., Shawinigan, Que., and St. John’s, Nfld.  — in Winnipeg, Sudbury, Ont., Jonquière, Que., and Summerside, P.E.I. — are now specializing in tax processing and grew in size.

NVCCs focus on “the delivery of the collection, compliance, and verification of both simple and complex collections files,” the CRA told Global News.

As a result, processing of tax returns and benefits applications was consolidated in fewer sites. According to the plan laid out by the government, the processing centre in Sudbury, in particular, would experience “a significant increase in processing workloads,” something Ottawa planned to tackle by beefing up local staff.

WATCH: A look at how taxes affect your savings outside an RRSP or TFSA

In previous correspondence with Global News, the CRA has said that despite the increased work volumes in the review programs, “the vast majority of the files are being processed within the expected timeframes.”

Still, Global News has received numerous emails from Canadians alleging that as of late July, they still had to receive their notice of assessment, with CRA call centre agents often blaming unusual workloads.

READ MORE: Five things you need to do to win (or survive) a CRA tax audit

One woman, in particular, who asked to be identified only as Ellen, said she was told in a phone call with the CRA that a decision to shift tax-processing tasks from the St. John’s to the Sudbury centre was causing delays.

According to the CRA website, the agency has so far processed over 98 per cent of the roughly 28.4-million individual tax returns it received between Feb. 12 and July 29 of this year. That leaves about 430,000 returns still to be processed.

For his part, Fitzsimmons said he isn’t upset about his file being selected for review or the agency asking for additional information. But he is unimpressed with what he believes has been a failure by the agency to communicate about service delays.

“Some head of communication should have said, ‘We are overwhelmed and all bets are off,'” he said. “Instead, they’re going totally radio silent.”

© 2018 Global News, a division of Corus Entertainment Inc.

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