Canada Revenue Agency consultations on reporting fees for service
Status: Closed
Reporting fees for service (RFS) is the legislated requirement for businesses and organizations to report fees paid to other businesses for services provided. Payments that exceed $500 in a calendar year must be reported to the Canada Revenue Agency (CRA) in prescribed form, usually the T4A slip.
Collecting data on these payments allows the CRA to validate the income and expense amounts businesses and organizations report on their tax returns.
In 2011, a moratorium on assessing penalties for failing to complete box 048, Fees for services, of the T4A slip was introduced. This was meant to allow businesses and organizations time to gain familiarity with the changes and adopt practices to comply with the RFS requirement. Though it was intended as a temporary measure, the moratorium remains in place.
Consultation methodology
The CRA's People First philosophy guides us to meet client needs and expectations by putting people at the centre of everything we do. Our philosophy reinforces the importance of engaging people to understand their experiences, the issues that they face, and how we can improve our programs and services to align with their specific needs.
The CRA recently conducted a variety of engagements to better understand Canadian businesses' and organizations' awareness of the RFS requirement, and the challenges they face with meeting this reporting obligation. These engagements consisted of:
- an online questionnaire (open to all Canadian businesses and organizations who hire another business or businesses to receive a service in exchange for payment), which ran from May 22 to July 22, 2024. In total, the CRA received 1,460 completed questionnaires
- a working group with key stakeholder organizations representing businesses of varied industries and sizes across Canada (by invitation), which held eight meetings between March and November 2024
What we learned
The results of the questionnaire are available in the Reporting fees for service online questionnaire – What we learned – Summary.
The results of the working group are available in the Reporting fees for service external stakeholder working group – What we heard – Summary.
What’s next
The CRA will use the results from the online questionnaire and working group, along with insights from other stakeholder engagement activities, to help inform future decision-making related to RFS.
We extend our sincere thanks to both the online questionnaire respondents and the members of the RFS working group for their valuable contributions. Your feedback will play a crucial role in clarifying the RFS reporting requirement, streamlining related processes, and enhancing our support for businesses and organizations in meeting their tax obligations.
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