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T2 Schedule 346

Have had this small but annoying problem a few times. Recently filed a clients T2, year end June 30,2020. The assessment come back indicating the client owes $23 more than we submitted. (Ok- Small I know but annoying and makes us look bad.) The problem is the provincial tax calculation on Schedule 346. CRA has calculated the entire 366 day year at 3 % instead of 275 days (up to April 1,2020) at 3% and 91 days (after April 1,2020) at 2.5%. I have spoken with agents about this and they don’t see the detail calculation at all, they just see X dollars at 3%. The solution is to either write a letter (hardly practical) or file a notice of objection. A lot of work for $23 but it’s the principle of it now.

Anyone else have the problem? Did you just let it go?

Nick

@nick

Bill 243 containing the NS corporate tax reduction to 2.5% received Royal Assent on March 10, 2020. So, the new tax rates are already in effects and taxpayers are entitled to them. From my experience, CRA’s form publication and system update for provincial tax rate changes are almost ALWAYS very late.

CRA had a roll over of their system recently and may have updated to the the new provincial rates. I am assuming that your T2 was assessed before that update. But, I would expect that your T2 would be reassessed to give you the $23 back. But, I recommend that you check with CRA.

Steven

The T2 was assessed Sept.23,2020. Do you know when the rollover happened? This has happened before and the CRA agent can’t change it.

@nick It was in mid October.

I don’t have this specific problem as I don’t have any clients in your province but what we used to do when the CRA regularly messed up the OETC credits - also by small amounts - was just send them a form letter that the secretary made pointing it out. It was a processing glitch so the form letter just referred to the glitch and how it was supposed to be calculated. Most of the time they fixed it with no further efforts.

Thanks Steven, I’ll try to get them to reassess.

Nick