Changes to the Voluntary Disclosures Program: Here's What You Need to Know!
If you’ve ever made a mistake on your taxes - missed reporting income, claimed an ineligible expense, or simply forgot to file something - you’re not alone. The Canada Revenue Agency (CRA) understands that errors happen, and that’s why they offer the Voluntary Disclosures Program (VDP) - and starting October 1, 2025, the program is getting a major refresh to make it easier, fairer, and more accessible for Canadians.
Remember - when you make a Voluntary Disclosure Program application, you need to report all of the years in which you omitted or failed to disclose information - more is definitely more. You can’t pick and choose what you include - the application needs to be complete. Otherwise the CRA could reject it.
Let’s break down what’s changing and how it might benefit you or your business.
What Is the Voluntary Disclosures Program (VDP)?
The VDP allows taxpayers and registrants to voluntarily correct errors or omissions in their tax filings before the CRA contacts them. If accepted, applicants may receive relief from penalties and some interest charges.
What’s Changing on October 1, 2025?
Simplified Application Process
The CRA is introducing a new version of Form RC199, designed to be easier to complete and submit. This is part of a broader effort to make the program more user-friendly and accessible.
Expanded Eligibility
Previously, if you received any communication from the CRA (like an education letter), you were likely disqualified from the VDP. Now, you may still qualify, even if the CRA has reached out about a potential issue
However, you’re still not eligible if: You’re under audit or investigation OR if your non-compliance was egregious or intentional
Two Tiers of Relief
The CRA is introducing two types of relief, depending on how your application is prompted:
General Relief (Unprompted Applications):
75% interest relief
100% penalty relief
Partial Relief (Prompted Applications):
25% interest relief
Up to 100% penalty relief
This tiered system ensures fairness while still encouraging voluntary compliance.
What Documents Do You Need to Include?
If your situation involves multiple years of non-compliance, here’s what you’ll need:
Foreign-sourced income/assets: Most recent 10 years
Canadian-sourced income/assets: Most recent 6 years
GST/HST disclosures: Most recent 4 years
You only need to include years where errors or omissions occurred. The CRA may request additional documents if needed.
Why Use the VDP?
Correcting your tax affairs through the VDP gives you:
Peace of mind knowing you’re compliant
Financial relief from penalties and interest
Support for public services by contributing fairly to Canada’s tax system
Want to Apply?
Starting October 1, 2025, you can use the updated Form RC199 to apply. If you’re unsure whether the VDP is right for you, the CRA offers anonymous pre-disclosure discussions with a CRA official.
Individuals: 1-800-959-8281
Businesses: 1-800-959-5525
If you need assistance or if our firm is already handling your taxes, we are more than happy to help you submit your VDP application.