Several members have reached out to us regarding penalties being assessed on Schedule 15 in cases where the form was filed on time and apparently completed correctly.
We submitted two sample notices of assessment for paper-filed T3 returns that resulted in penalties. The CRA informed us that these penalties were due to manual processing errors and advised that they would proactively correct affected accounts where possible:
"The CRA will proactively correct affected accounts to the greatest extent possible. However, this does not apply to all accounts, as there is a wide variety of schedule 15 penalty scenarios, many of which are validly assessed."
We also asked the CRA to tell us some common mistakes that practitioners are making when submitting trust returns resulting in Schedule 15 penalties. The CRA identified two common issues that members should be aware of as explained in the quote below.
"As requested, please find below some common mistakes that practitioners are making when submitting trust returns resulting in schedule 15 penalties:
Attempting to change the fiscal period end date of the trust. Fiscal period end dates cannot be changed and attempting to do so can cause return processing errors.
Failure to review the explanations on the notice of assessment from the previous year. There are situations where the CRA is not able to accept schedule 15 information as filed due to the Privacy Act. It is indicated on the Notice of Assessment that the information has not been stored. In these situations, if the tax practitioner submits a return for the subsequent tax year and indicates that there is no change to their previously submitted beneficial ownership information, they will receive a penalty because the CRA has no information stored on file.
The CRA recommends reviewing the prior year's Notice of Assessment to confirm whether the Schedule 15 was accepted as filed. A complete Schedule 15 (Part A, B and C) must be filed with the T3 return if beneficial ownership applies."
CPA Canada continues to engage with the CRA to help practitioners avoid penalty assessments.
Originally posted on LinkedIn on July 30, 2025
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Ryan Minor
Chartered Professional Accountants of Canada
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