Category Archives: Automatic filing

Budget 2025: What You Need To Know

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Tabled in Parliament in November, Budget 2025 promises sweeping changes, but how much of it truly reaches Canada’s most vulnerable residents? This article takes a closer look at the measures that matter for low‑income households, from a modest supplemental payment tied to the Canada Disability Benefit to the government’s plans for automatic benefit delivery. It highlights what’s new, what’s missing, and why some of these changes may not work as smoothly as intended.

Budget 2025 did not announce any new funding to replace the Canada Revenue Agency’s pilot grant project which terminated providing support to the CVITP in October 2025.  With automatic filing on the horizon and volunteer shortages looming, this article raises important questions about whether low‑income Canadians will actually see more support—or risk falling through the cracks. Dive in to explore the full implications.

Looming Volunteer Shortage Could Undermine CVITP in Next 5 Years

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In the first of two articles, I look at the demand for and supply of CVITP services to illustrate a growing problem with volunteer recruitment.  Looking at the recent past, I conclude there has likely been a large unmet demand for CVITP services.  However, the recruitment of volunteers, who are the linchpin in the provision of CVITP services, has been sluggish.  Looking ahead, I speculate that the demand for CVITP services is unlikely to decline and may even grow as automatic tax filing gets introduced for low-income individuals and households.

If I am correct, this implies that CVITP volunteer recruitment will need to be ramped up.  In the second article, I review recent trends in volunteering within Canada which suggest that it will be increasingly more difficult to recruit volunteers.  As volunteer recruitment is a responsibility shared between the Canada Revenue Agency (CRA) and host organizations, I look at how both are doing.  I conclude that the CRA has no plans to ramp up volunteer recruitment and that most host organizations are in the same position.

Thus, CVITP volunteer recruitment is the slow-moving crisis that could undermine the CRA’s ability to continue providing quality in-person services to low-income households in the coming years.

Council Has Too Much Faith in Automatic Filing, Undervalues CVITP

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The National Advisory Council on Poverty’s latest report highlights automatic tax filing as a solution for getting low-income Canadians their benefits.  But use of the services offered through the Canada Revenue Agency (CRA) SimpleFile pilot project has been minimal.  Most people relied on traditional service providers, especially the CVITP, to file correctly.  The CRA’s evolving plans for automatic tax filing risk producing similar results.  Many will still turn to the CVITP which assists nearly a million people annually.  Even though the CVITP has serious resource limitations, the CRA is silent on providing further funding.

In all this, the Council has yet to acknowledge the long-standing CVITP, let alone its resource limitations.  This article explores what this omission means for the Council’s credibility and the CRA’s policy.

Will Automatic Tax Filing Live Up To Its Promise?

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Loyal readers know I have been tracking the federal government’s work on automatic tax filing for low-income Canadians ever since it was first announced in the 2020 Speech from the Throne.  After six years of delay, some social policy advocates predict that the announcement by the Prime Minister a few weeks ago will be a game-changer for delivering benefits and reducing poverty.

My own experience as a volunteer with the Canada Revenue Agency’s Community Volunteer Income Tax Program (CVITP), however, leaves me sceptical.  I believe the CRA’s current vision of automatic tax filing is unlikely to deliver the improvements promised – especially for those who have not been filing returns and missing out on benefits.  Here is why.

1The first article in this three-part series, “SimpleFile in 2024 and 2025”, examines the pilot the CRA launched in 2024 and continued to promote in 2025.  This was the CRA’s initial response in the government’s push for automatic tax filing.

As the evidence shows, SimpleFile has been an abysmal failure – despite the CRA’s claims to the contrary.  The evidence speaks for itself – read the article and judge for yourself using the CRA’s own numbers.

2The second article, “Further Experimentation in 2026”, reviews the CRA’s evolving plans, which use the SimpleFile invitation – if not its filing methods – as a pathway toward automatic tax filing.  It’s an interesting development, but one fraught with challenges that may limit adoption of this new form of automatic filing.

Moreover, individuals who have not filed a return in the last two or more years – and are therefore missing benefits – will be excluded.  The CRA is also unlikely to prepare pre-filled returns for past years, even when those years could mean substantial missed benefits.  Individuals will need outside help to prepare and file those returns.

3The third article, “Be Careful What You Wish For in 2027”, looks at the Prime Minister’s recent announcement of a large-scale rollout and considers what may unfold between 2027 and 2029.  The CRA plans to rely heavily on technology to deliver automatic tax filing.  This initiative will likely shift low-income Canadians who already file returns and get benefits from one filing method to another.  By preparing returns itself, the CRA could, in theory at least, bypass intermediaries such as the CVITP.

Yet many individuals already find CRA documentation and correspondence confusing. Many recipients of pre-filled returns will likely turn to trusted sources for help in understanding their pre-filled return and for advice before consenting to the CRA’s filing.

The CVITP is well positioned to provide this support free of charge.  With some 3,500 host organizations and 18,000 volunteers embedded in communities across Canada, it is a trusted network.  This article argues that by adapting the CVITP to help meet these challenges, the CRA could significantly boost adoption of automatic tax filing.

Across the three articles, I argue that by design, the CRA’s automatic tax filing initiative is unlikely to help low-income Canadians who have not been filing returns or receiving benefits.  Yet this was the originally rationale for introducing automatic tax filing.  Given its community roots and more than 50 years of earned trust, the CVITP remains the best option for fulfilling that promise.

Federal Government’s Fall Economic Update: Gambling With The CVITP’s Future

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Every fall, the Department of Finance Canada provides an update informing the public about the state of the federal government’s finances and key economic development.  The Fall Economic Statement (FES) for 2024 was issued on December 16.  Intriguingly, it touched on the issue of filing the returns of low-income Canadians.

The articles in this two-part series tackle both what the FES said and what it did not say about this subject as the government’s omissions were as relevant to the CVITP as its treatment of the filing of returns for low-income Canadians.

The first article provided commentary on what the FES had to say about advancing its agenda for the automatic filing of low-income Canadians’ income tax and benefit returns.  This second article highlights two areas of relevance to the CVITP where the FES might have been expected to say something but was silent.  These omissions create uncertainties around the federal government’s long-term commitment to the CVITP.

The main source of these uncertainties is the assumption Canada Revenue Agency officials are probably making that the futures of automatic tax filing and the CVITP are inextricably linked.  As automatic tax filing becomes the norm for low-income Canadian residents, they may believe the CVITP could be substantially scaled back.

Working from these omissions, this article offers three scenarios for future CVITP funding together with their respective impact on CVITP operations.  It also assesses the likelihood of each scenario based on current political realities.

The most probable of these three scenarios will prove disruptive to the CVITP’s future operations.  Even so, like the other two scenarios, it suffers from a fundamental flaw inherent in the advancement of automatic tax filing as currently envisioned by the federal government.

Read here to learn more about what all this means for the CVITP as well as for non-filers who were the original focus of the automatic tax filing initiative.

Federal Government’s Fall Economic Update: Doubling Down on Automatic Tax Filing

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Every fall, the Department of Finance Canada provides an update informing the public about the state of the federal government’s finances and key economic developments.  The Fall Economic Statement (FES) for 2024 was issued on December 16.  Intriguingly, it touched on the issue of filing the income tax and benefit returns of low-income Canadians.

The articles in this two-part series tackle both what the FES said and what it did not say about this subject as the government’s omissions were as relevant to the CVITP as its treatment of the filing of returns for low-income Canadians.

The first article presents and comments on what the FES had to say on this subject.  The FES discussion was limited to advancing its agenda for the automatic filing of low-income Canadian’s income tax and benefit returns.  This article highlights the relevance of this agenda for the CVITP.  It also lays the foundations for the second article, which speculates on some reasons why the CVITP may suffer from weak growth over the next few years.

CVITP Has Been Forgotten by National Advisory Council on Poverty

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Our work is based on the connection the federal government has drawn between poverty reduction and the CVITP in its 2018 Poverty Reduction Strategy.  Specifically, this strategy recognizes the important role the CVITP plays in providing access to the many federal (and provincial/territorial) benefits designed to reduce poverty.

Following the publication of the Strategy, the Poverty Reduction Act was adopted as law by Parliament in 2019.  Among other things, the Act requires the federal government to set up a National Advisory Council on Poverty.  To date, the Council has produced five annual reports (2020 – 2024).  Yet nowhere in these five reports is any mention made of the CVITP.  We find this surprising.

In its reports, the Council urges improved access to existing benefits.  Yet the Council never considers the role that the CVITP currently plays in facilitating access to those benefits, the challenges it faces in doing this and its weak performance in meeting these challenges.

Learn here why we think the Council should not remain silent on the only federal government initiative designed to help those living in poverty get the benefits to which they are entitled.  Read here what the Council should instead be doing.

CRA’s Automatic Tax Filing: Shortcomings of the “SimpleFile” Pilot

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In a series of three articles, we look at three initiatives other than the CVITP that the Canada Revenue Agency (CRA) seems to be focusing its efforts on to reach low and modest-income Canadian residents.  We show why these initiatives presently show less promise than the CVITP in tackling the fundamental problem of helping a greater percentage of Canada’s impoverished residents access the benefits to which they are entitled.

In the first article of this series, we looked at the CRA’s non-filers benefits letter initiative.  We argued that the results are insignificant, even questionable and bear no comparison with those obtained by the CVITP when it comes to assisting those living in poverty.

In the second article, we looked at SimpleFile by Phone, the CRA’s automated phone service for filing returns which has operated since 2018 under a different name, File My Return.  We concluded that the results are insignificant, especially when compared with those produced by the CVITP.  It is also far less cost efficient in producing results than the CVITP.  Furthermore, we showed why the service does not live up to its stated promise of helping Canadians who have not filed in the past to access their benefits.

In this third article, we look at the CRA’s long awaited pilot for automatic tax filing, SimpleFile, which was launched in July 2024.  Learn here why we think that, unlike its billing, filing a return under this new method is not automatic, the process is not “simple” to complete, this new method will not reach non-filers as originally intended, and the launch of the pilot is not well timed so is likely to perform poorly.

Rebranding “File My Return” as “Simplefile by Phone” Fails to Get Better Results

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In a series of three articles, we look at three initiatives other than the CVITP that the CRA seems to be focusing its efforts on to reach low and modest-income Canadian residents.  We show why these initiatives presently show less promise than the CVITP in tackling the fundamental problem of helping a greater percentage of Canada’s impoverished residents access the benefits to which they are entitled.

In the first article of this series, we looked at the CRA’s non-filers benefits letter initiative.  We argued that the results are insignificant, even questionable and bear no comparison with those obtained by the CVITP when it comes to assisting those living in poverty.

In this second article, we look at SimpleFile by Phone, the CRA’s automated phone service for filing returns which has operated since 2018 under a different name, File My Return.

Learn here why the results are insignificant, especially when compared with those produced by the CVITP.  It is also far less cost efficient in producing results than the CVITP.  Furthermore, we show why the service does not live up to its stated promise of helping Canadians who have not filed in the past to access their benefits. It is important to recognize the limitations of SimpleFile by Phone because, as will be seen in the third article, this is also part of the CRA’s pilot aimed at launching automatic tax filing.

How to Reduce the Number of Recent Non-filers by Using the CVITP Better

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In our first article in this series, we argued that while the number of current non-filers may not be as large as some popular estimates, the number is still very large and represents a serious drag on achieving the federal government’s poverty reduction objectives.  In this second and the next article, we show how the Canada Revenue Agency (CRA) could make better use of the CVITP to reduce the number of non-filers more effectively than its current efforts.

This second article deals with recent non-filers, those who forget to file, file late, or skip one or two tax years.  Most importantly, the CRA can still communicate with these clients as it has their current mailing addresses.

We focus on two initiatives.  The non-filers benefit letter campaign has been operating since 2016.  (We have previously reviewed this initiative here.)  We suggest providing letter recipients with the name, address and phone number of the closest CVITP host organization where they can get their returns done for free, and informing these organizations of the names and addresses of letter recipients who have been referred to them.  This may improve the rate at which letter recipients, most of whom are recent non-filers, respond.

The automatic filing of income tax and benefit returns will be experimented with starting next year.  (We recently reviewed this new initiative here.)  Some traditional CVITP clients may receive a pre-populated return from the CRA to review and send back, confirming the information contained in the return is complete and accurate.  Should they have any questions about their return or the process, some clients receiving such a return may not own a phone with which to call the CRA.  Others may not trust the CRA to provide clear answers to their questions.  Yet again others may not understand what is being asked of them.  To increase the success of this initiative, we recommend involving CVITP host organizations and their volunteers to help answer questions these clients may have.  While these clients are unlikely to be non-filers, if this initiative is successful, it will reduce the number of traditional CVITP clients thereby freeing up CVITP capacity to take on new clients, some of whom may not have filed a return in many years.

Neither of these initiatives is likely to substantially reduce the number of what we call chronic non-filers who make up the majority of non-filers.  The CRA’s chief problem is that it does not have current mailing addresses for these clients.  Therefore, it has no way of communicating directly with them.  Yet this is the group the CRA should be trying to make inroads with if it is to substantially increase its coverage of poverty reducing benefits. We believe the CRA could also make use of the CVITP to reduce the number of chronic non-filers.  This will be the subject of the third and final article in this series.

Automatic Filing is No Magic Fix for Getting Benefits to More Low-income People

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The federal government’s Budget 2023 has announced plans to help more low-income Canadians who are not currently filing their returns to get the benefits to which they are entitled.  In this article, we explain why both of the proposed initiatives are unlikely to succeed.  What follows is a summary of the article.

One of the initiatives aims to increase the number of eligible Canadians using the File My Return (FMR) service to two million by 2025. This service, introduced in 2018, allows eligible Canadians to file their income tax and benefit returns over the phone by answering a series of short questions using an automated function.

However, the use of this service has been consistently low, with less than 10% of eligible users taking advantage of this service annually over the past five years.  Complicated instructions that require a high level of reading skills in one of the official languages and understanding of tax-related concepts, confusion over various automated options, and distrust in the government are some of the reasons which have contributed to the low take-up rates. Furthermore, usage depends on the Canada Revenue Agency (CRA) having the correct mailing address for the recipient, which it lacks for many current non-filers.

The other initiative proposes to pilot a new automatic filing service next year.  However, the attention given to automatic filing is misplaced.  Although the returns of some low-income residents could be automatically prepared by populating various parts, the CRA will still need to contact non-filers to obtain their approval of their returns.  The CRA’s track record in contacting low-income non-filers and getting them to respond is extremely poor and there is no reason to believe the response to this new initiative will be any different.

In the next few years, if the CRA wants to reach more low-income people who are not filing their returns, it should focus on strengthening the CVITP.  The CVITP is the main initiative the CRA relies on to help meet the objectives of the federal government’s 2018 Poverty Reduction Strategy.  With over 50 years of direct person-to-person contact and the trust this engenders, the CVITP remains the CRA’s best option for increasing vulnerable people’s access to the benefits they are entitled to.

Automatic Tax Filing: a Solution or a Problem?

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The most recent Speech from the Throne contained a reference to the introduction of automatic tax filing of returns.  We believe that the process of moving toward automatic filing will take some time as the federal government will first have to negotiate changes with the provinces and territories; many income tax and benefit returns will remain too complicated to be filed automatically; and automatic return preparation may be a more appropriate way to think of the change as people will still have to agree to the results before their returns can be filed.  Consequently, even when automatic filing is eventually introduced, we think that CVITP clinics will remain an essential service for many clients with low or modest incomes.

Read more about why we think this here.