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tax1GLGI participants: it has now been almost a month since the court ruling was released regarding Mariano v. Her Majesty the Queen, and since that time we’ve received a large number of calls from individuals who are concerned about their own participation in the Global Learning Gift Initiative and the subsequent ruling on October 19th.

The determination of Justice Pizzitelli that “Appellants did not have the donative intent to make any of their gifts, did not own or transfer the property that is the subject matter of the gift in kind” has been a cause for major concern amongst this group of participants. The court’s decision to disallow the claiming of GLGI donations, thereby nullifying the previously granted tax credits, has left thousands of people with significant tax debts and an overwhelming sense of uncertainty.

In an effort to assist, here are a few suggestions as far as next steps.

Our first suggestion is to avoid calling CRA directly. Since the GLGI ruling has given CRA the confidence to go after participants in full force, you will largely be doing yourself a disservice if you attempt to negotiate a repayment plan. This is especially true because of CRA’s previous offer to grant a portion of the donation and eliminate interest in exchange for waiving the right to appeal or object.

Why you should not attempt to negotiate: since CRA agents have the power to levy enforcement action, any information you share can, and likely will, be used against you if negotiations fall through. For example, if you share you banking information in an attempt to seem cooperative, you are then unprotected as far as a frozen bank account.

Something else to keep in mind with regard to negotiations: the goal of a repayment plan, as far as CRA is concerned, is to regain all of the money owed as soon as possible. This means that reasonable repayment terms are often little more than a pipedream. If you do not believe total repayment is possible over a 6 or even 12 month term, you will likely be unable to come to a satisfactory conclusion with an agent.

Our second piece of advice is to contact a tax specialist, one with the knowledge and a sound understanding of not only CRA policies and procedures, but the entire GLGI case as well. Seeking outside advice, advice that is based on the best course of action for your individual circumstances, is the best way to determine what your next steps may be.

If you are one of the many GLGI participants reeling after the most recent court ruling, call Tax Solutions Canada today. Our experience and expertise will help you determine the best route to take as for as GLGI issues, dealing with CRA enforcement action, and protecting yourself throughout the entire process. 1-888-868-1400.