What is the Voluntary Disclosures Program and can it help me fix past HST mistakes?
The Voluntary Disclosures Program (VDP) is a CRA program that allows taxpayers to come forward and correct unreported or under-reported taxes — including HST — before the CRA discovers the error. If your disclosure qualifies, the CRA generally waives civil penalties and may reduce interest, making it significantly less costly to fix past mistakes than waiting for an audit.
To qualify for the VDP, your disclosure must be: voluntary (the CRA cannot already be aware of the issue or have contacted you about it), complete (you must disclose all related non-compliance, not just part of it), and involve information that is at least one year overdue (there is no benefit for correcting errors within the normal filing window).
The VDP has two streams: the General Program (for most applicants, which can provide full penalty relief and partial interest relief) and the Limited Program (for more serious or deliberate non-compliance, which offers penalty relief but no interest reduction). Applying through the VDP can be a smart move if you realize you have been collecting but not remitting HST, underreporting sales, or failing to file returns.
Key takeaways
- The VDP allows self-correction of HST errors before the CRA finds them, with penalty relief.
- Your disclosure must be voluntary, complete, and involve information at least one year late.
- Two streams exist: General (full penalty relief) and Limited (penalty relief only).
- Apply before the CRA contacts you — once they do, VDP relief is unavailable.