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Notes

(1) This penalty applies only where the taxpayer has been subject to the “first occurrence”

penalty within the three preceding taxation years and a demand for the income tax return

has been made by the Canada Revenue Agency (CRA).

(2) In respect of the Partnership Information Return, where there has previously been a

“first-occurrence” penalty within the three preceding taxation years and a demand for the

return has been made by the CRA, an additional penalty of $100 per partner is levied for

each month or partial month (not exceeding 24 months) that the failure continues. A new

penalty was introduced in 2012 for failure to file a tax shelter information return equal to

25% of the greater of cost of shelters sold prior to date that the demand for the return

was made by the CRA and the total value that an investor in the tax shelter could donate

under a gifting arrangement (as defined in the Income Tax Act).

(3) These penalties are imposed where a taxpayer knowingly, or under circumstances

amounting to gross negligence, fails to file certain information returns (i.e., Forms T106,

T1134, T1135, T1141, and T1142, as discussed in the table “Other Selected Federal Filing

Deadlines”). Where the taxpayer fails, knowingly or under circumstances amounting to

gross negligence, to comply with a demand made by the CRA to file a foreign-based

information return, the penalty is increased to $1,000 per month to a maximum of 24

months.

(4) This penalty is not applicable where a reasonable attempt was made to obtain the

outstanding information, or where a Social Insurance Number was applied but not

received at the time the return was filed. A new penalty was introduced in 2012 for failure

to provide tax shelter information equal to 25% of the greater of cost of shelters sold

prior to date that the demand for the return was made by the CRA and the total value that

an investor in the tax shelter could donate under a gifting arrangement (as defined in the

Income Tax Act).

Selected Federal Penalty and Offence Provisions

Current as of May 3, 2013