Eligibility

  1. Overview
  2. Eligibility
  3. Apply for EFILE
  4. Certified software
  5. File returns

Who can use EFILE?

Any firm, organization, or individual providing tax preparation services who has met the definition and requirements of an applicant and who has successfully met all the suitability screening criteria will be given access to the full suite of EFILE Online services. The current list of electronic services is as follows:

  • EFILE web service
  • Corporation Internet Filing
  • T1135 transmission web service
  • T1013 transmission web service
  • Client Data Enquiry (CDE)
  • Auto-fill my return
  • Online Mail

The EFILE web service allows you to transmit your client's returns directly from your tax preparation software. You get an acknowledgement of the acceptance or rejection of an individual return instantly. Your software has the capability to simulate the batch filing process by transmitting multiple returns at once and providing an instant acknowledgement of each return that you have transmitted.

Tax preparers who prepare more than 10 returns for a fee must file them electronically. Mandatory electronic filing applies to the filing of both T1 and T2 tax returns for the 2012 and subsequent tax years. For more information on mandatory electronic filing, go to Mandatory electronic filing for tax preparers.

To participate in the Community Volunteer Income Tax Program (CVITP), you must first register as a volunteer with the CVITP at cra-arc.gc.ca/tx/ndvdls/vlntr/lnd-eng.html. If you intend on transmitting returns by EFILE under the CVITP, you must also apply for an EFILE number.

If you or your business provides tax-discounting services, visit Information for discounters.

To access important forms, go to: Forms T183 and T1013

Suitability screening

What is suitability screening?

Suitability screening is the process of verifying the reliability of prospective and existing electronic filing applicants. It is conducted by the Canada Revenue Agency (CRA) every year before applicants are permitted to electronically file income tax returns on behalf of their clients. This process may take up to 30 days. To give the CRA enough time to screen all new and existing applicants before the filing season starts, we encourage you to file your application or renewal before December 31st. If we cannot process your application or renewal within this 30-day time frame, we will notify you.

The EFILE number and password combination issued to you upon registration or renewal may only be used for account maintenance purposes until suitability screening has been completed. Depending on when we receive your account renewal, you may be able to continue to use certain electronic services. To ensure your transactions are accepted, your tax preparation software must be updated with the newly assigned password you received during the renewal process.

You will be notified by email or letter when suitability screening has been completed and the criteria successfully met.

Why do we screen applicants?

We evaluate all applicants before, during, and after the filing season to:

  • safeguard the system;
  • maintain a high level of public confidence in electronic filing;
  • ensure all participants in the program adhere to high standards of conduct and integrity; and
  • evaluate the applicant's risk as an electronic filer.

We may deny someone permission to participate if our screening reveals a history of tax fraud or tax evasion. Subsection 150.1(2) of the Income Tax Act gives us the authority to evaluate prospective and existing electronic filers.

Definition of applicant

For EFILE purposes, an applicant can be:

  • the proprietor of a sole proprietorship;
  • the members of a partnership (for large or national partnerships, the managing tax partners would be the applicants);
  • the directors, officers, and controlling shareholders of a corporation;
  • the managers of the branch offices;
  • the proprietor, the members of a partnership, or the directors, officers, or controlling shareholders of a corporation who hold a franchise (for large or national partnerships, the managing tax partners would be the applicants);
  • any person having management and control of any of the applicants listed above; or
  • any person (not including employees of a sole proprietorship, partnership, or corporation unless they also fall under one of the applicant types above) who prepares T1 individual and benefit returns on behalf of others, such as a sub-contractor.

A business or organization applying for electronic filing may have more than one person who meets the definition of applicant. All applicants must be included on the EFILE registration or renewal form. If there are more than four applicants, please send a list of other applicants (include the Social Insurance Number (SIN), name, and title for each additional applicant) to your EFILE Helpdesk. If you do not send this list, the processing of your application could be delayed. Your EFILE Helpdesk will be indicated on the confirmation page that will be displayed when you register or renew.

An applicant, or any person having management and control of the applicants, must:

  • be 18 years of age or older;
  • be a Canadian resident;
  • have a valid Social Insurance Number (SIN); and
  • if applicable, be a discharged bankrupt, regardless of whether his or her trustee in bankruptcy is discharged (a trustee in bankruptcy can be an applicant only if he or she is acting for his or her business; a trustee acting for an undischarged bankrupt cannot apply).

Screening criteria

An applicant/participant who meets and continues to meet the following criteria may electronically file income tax returns provided he or she has:

  • not been convicted under the Income Tax Act or the Excise Tax Act or an income tax act of a province or territory;
  • not been assessed a penalty under the Income Tax Act, the Excise Tax Act, or an income tax act of a province or territory;
  • not failed to file personal, corporate, GST/HST, or information returns as required, under the Income Tax Act, the Excise Tax Act, or an income tax act of a province or territory;
  • not failed to comply with the requirement to pay, collect, or remit taxes as required under the Income Tax Act, the Excise Tax Act, or an income tax act of a province or territory;
  • not failed to comply with the requirement to register under the Excise Tax Act;
  • not failed to comply with the requirement to keep adequate books and records under the Income Tax Act or Excise Tax Act;
  • no tax liability under the Income Tax Act, the Excise Tax Act, or an income tax act of a province or territory, or he or she has a tax liability and has reached a repayment agreement with the collections section of the tax services office, or a similar provincial authority, and has not breached the repayment agreement;
  • not been convicted of an offence under the Tax Rebate Discounting Act;
  • not made any misrepresentations on their application or renewal form or in any correspondence, conversations or updates submitted relevant to the application or renewal;
  • not engaged in any activities that resulted in suspension of electronic filing or SEND privileges in a previous year, or that would have led to suspension if they had been discovered during the program;
  • not been rejected for EFILE in either of the previous two filing seasons (other than one that was conditionally rejected but later met the required conditions);
  • not or does not knowingly, directly or indirectly, employ or accept help from any person who has been, or who would have been, denied acceptance into the program or who has been suspended from the program. This includes any individual whose actions resulted in the rejection or the suspension of a corporation or a partnership from the program; and
  • not engaged in fraud, dishonesty, breach of trust, or other conduct of a disreputable nature.

In order for the CRA to perform the required suitability screening, applicants must complete the EFILE Registration Online form and provide all the information listed, including their Social Insurance Number.  For existing electronic filers, they must Log in to renew their application as yearly online renewal is required for continued participation in the EFILE program.

We may still allow applicants who fail to meet the criteria to file electronically if we determine that the failure does not affect the application/renewal. For instance, we may accept an applicant if the failure was an isolated incident, was minor in nature, or occurred many years before the application/renewal.

If we deny your participation, we will send you a letter outlining the reasons for denial. You have the right to an administrative review. You can ask for a review by writing to the Chief of Appeals at one of the Appeals Intake Centres. Include a copy of the denial letter with your request.

Responsibilities

As an electronic filer

  • You must renew your participation in electronic filing on a yearly basis and inform the CRA of any changes to your EFILE registration. To modify your account, access the Account maintenance page.
  • Deal directly with your client. You cannot accept and transmit records from an unregistered preparer. If you offer transmission services to clients who prepare their own returns, we consider you to be acting as the tax preparer and require you to fulfill all the responsibilities outlined below.
  • To protect your interests and the integrity of our tax system, take proper care to verify the identity of your client. Ensure your client has documents (such as information slips and receipts) to support all income, deductions, and credits reported or claimed on the return. Verify the authenticity of these information slips before conducting financial transactions.
  • Inform your client that elections, designations, agreements, waivers, and special elective returns must be submitted on paper by the appropriate due date, as established in the Income Tax Act.
  • Make sure your client completes and signs Form T183, Information Return for Electronic Filing of an Individual's Income Tax and Benefit Return before transmitting the return. When filing a return for a pre-bankruptcy period or for a deceased person, Part F of the T183 is to be signed by the trustee in bankruptcy or the legal representative. In the case of the return of a deceased person, that would be the executor or administrator of the estate. Please note that the legal representative for a deceased person is required to provide you, the electronic filer, with a copy of the proof of death certificate. If a legal representative for a deceased person signs Part E designating you as their representative for tax matters, he or she must first submit to the tax centre, a copy of the death certificate and the will designating him or her as the executor. If the person signing the T183 form has Power of Attorney (POA) for the taxpayer, he or she must provide you, the electronic filer, with a copy of the Power of Attorney. You must attach a copy of the death certificate or POA to the corresponding T183 form and keep the documents for a period of at least six years following the date the return was filed.
  • Ensure the return is prepared with software that has been certified by the Canada Revenue Agency (CRA) as compatible with EFILE.
  • Use only the EFILE number and password we assigned to you when you registered or renewed. Keep this information confidential.
  • Correct rejected records and transmit again. Inform your client of any delays in the transmission or acceptance of these returns. Advise your client, in writing, of any changes to refunds or balances owing.
  • Protect the confidentiality of taxpayer information and let us know immediately of any loss, suspected loss, or unauthorized disclosure of client information obtained through electronic filing.
  • Ensure that all documents are properly disposed of to protect your clients' confidentiality.
  • Comply with all provisions of the Income Tax Act.

In your advertising

  • Time frames quoted for processing an electronically filed return or refund have to be consistent with the time frame we quote, which is about two weeks.
  • You cannot imply a special relationship with, or an endorsement by, the CRA, nor can you use the CRA's signature or marking.
  • You cannot use the words authorized or agent in the advertising.
  • Any public communication that refers to EFILE cannot contain false, fraudulent, or misleading statements or claims.

If you want to use any part of a CRA publication (such as a guide, return, or schedule) in your advertising, you must first ask for our approval. In your request, indicate which publication you want to use and provide us with a sample of the advertisement. Send your request to PACROWNCO_G@cra-arc.gc.ca.

Monitoring

We monitor the activities of electronic filers to ensure that they comply with our requirements. This maintains a high standard of quality for electronic returns and transmissions. If an electronic filer does not comply with these requirements during the program, we will issue warning letters as required and can suspend EFILE privileges.

We monitor such items as the following:

We periodically request a number of copies of the T183 from each electronic filer. We may also request written explanation for errors noted during our review. EFILE privileges may be suspended if the forms and/or written explanations we request are not provided in the time frame that we specify.

Should we request T183 forms from you that are signed by someone other than the taxpayer (for example: Power of Attorney; Trustee in bankruptcy; or Executor or Administrator of the estate), you must submit copies of the documentation showing proof along with the requested T183 form.

Suspension

Conditions for suspension

The Canada Revenue Agency (CRA) reserves the right to revoke an electronic filer's authorization to participate in electronic filing if any one of the following conditions exists:

  1. failure to meet or continue to meet the suitability screening criteria;
  2. deterioration in the quality of individual transmissions;
  3. an unacceptable cumulative error rate;
  4. violation of the CRA's advertising standards;
  5. unethical practices in tax return preparation;
  6. late, missing, illegible, or incomplete T183 forms;
  7. stockpiling of returns for any reason other than the unavailability of the CRA's systems, unless the clients have been informed;
  8. significant complaints about an electronic filer;
  9. other facts or disreputable conduct that would reflect adversely on the program;
  10. failure to completely report any loss, suspected loss, or unauthorized disclosure of an EFILE password or client information;
  11. failure to protect the confidentiality of an EFILE number and password;
  12. failure to ensure that a client's source documents fully support all income, deductions, and credits reported or claimed on the return;
  13. failure by a preparer to deal directly with the client;
  14. transmitting returns for a non registered or unapproved tax preparer;
  15. failure to protect the confidential information obtained to electronically file the returns of your clients; and
  16. failure to inform the CRA of changes to your EFILE registration information (i.e. management and control related changes, address, phone and fax number, email address, etc.).

Warning letter

In most cases, we send a warning letter to the electronic filer before suspension. The letter informs the electronic filer of inconsistencies and asks the electronic filer to take corrective action. Any electronic filer who does not comply with the request will be suspended.

In other cases, an electronic filer could be suspended immediately, without warning and without possibility of reinstatement.

Administrative review process

Applicants who are denied participation, or electronic filers who are suspended, have the right to an administrative review. You should make your request for an administrative review in writing to the Chief of Appeals at one of the Appeals Intake Centres. Send a copy of the denial or suspension letter with your request. The time limit for filing this request is within 90 days of the date we mailed the denial or suspension notice.

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