Voluntary Disclosures Program

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Under the VDP, taxpayers who have not reported all of their income can voluntarily correct their tax affairs. They will not be penalized or prosecuted if they make a valid disclosure prior to any knowledge or awareness of the initiation of compliance actions being brought forth against them, by the CRA.
These individuals may only have to pay the taxes due and owing, plus interest. More information on the VDP can be found on the CRA Web site at http://www.cra.gc.ca. Conditions for a disclosure under the Voluntary Disclosures Program (VDP) allows taxpayers to come forward and correct inaccurate or incomplete information, or to disclose information they had not previously reported to the CRA. The CRA's Voluntary Disclosures Program is available to taxpayers who want to correct their tax affairs before the CRA begins any audit action or investigation.
If you make full disclosure before CRA begins any compliance action, you only have to pay the unpaid taxes plus interest, without penalty or prosecution.
A disclosure may be made for Income Tax, Goods and Services Tax, and Harmonized Sales Taxes (GST/HST) purposes. A valid disclosure must meet four conditions. These conditions require that the disclosure be voluntary, complete, involve the application or potential application of a penalty, and generally include information that is more than one year overdue. If the CRA accepts the disclosure, the taxpayer will have to pay the taxes or charges owing, plus interest. However, the taxpayer will not be subject to penalty or prosecution for those amounts accepted as a valid disclosure. There is a Right of Redress if a taxpayer disagrees with a VDP decision, in that the taxpayer may request a second review of their file by contacting the Director of the TSO, where the original decision was issued.
In addition, the taxpayer may pursue further recourse through the judicial review process.

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