06/19/2026
CRA's new auto filing initiative is a tax trap. They want full control of our taxes. Here are some of the reasons to think about when agreeing to let them file your taxes.
1. The CRA only knows what it knows
The biggest weakness is that the CRA's information is incomplete.
The CRA receives T4s, T5s, T4As, pension slips, and many other information returns, but it does not automatically know about many deductions, credits, and life changes unless the taxpayer reports them. Examples include:
Moving expenses
Medical expenses
Disability-related claims not already on file
Tuition transfers
Eligible dependant claims
Certain foreign income
Self-employment income
Rental income
Support payments
Changes in marital status or custody arrangements
A taxpayer may receive benefits but still miss credits they were entitled to because the CRA did not have all the information.
2. Risk of taxpayers blindly accepting CRA numbers
Many Canadians already assume that if information appears in My Account, it must be correct.
In practice:
T-slips can be amended.
Information can be missing.
Slips can be issued under the wrong SIN.
Family information may be outdated.
Auto-filing may create a false sense of certainty, causing people to stop reviewing their returns critically.
3. Low-income does not always mean simple
The CRA describes the program as being for people with "simple tax situations." However, many low-income Canadians have circumstances that are not simple:
Disability supports
Provincial social assistance
Gig-economy income
Informal self-employment
Shared custody arrangements
Foreign pensions
Multiple benefit programs
A return may appear simple based on CRA data while actually requiring taxpayer input.
4. Privacy concerns:
Automatic filing requires the government to rely heavily on centralized personal and financial information.
As automation expands:
More data integration is required.
More third-party reporting may be needed.
A larger amount of personal information becomes concentrated in government systems.
That increases cybersecurity and privacy risks, even if the systems are generally secure.
5. Errors can directly affect benefits:
For many low-income individuals, taxes are really a gateway to benefits:
Canada Child Benefit
Provincial credits
Disability benefits
Housing-related benefits
Other income-tested programs
An incorrect automatically filed return could affect benefit calculations for an entire benefit year.
6. It may not reach the hardest-to-reach non-filers:
One of the policy goals is helping non-filers receive benefits.
However, research suggests many persistent non-filers face barriers such as:
Homelessness
Lack of internet access
Mental health challenges
Language barriers
Frequent address changes
Those individuals are often the people the CRA has the least current information about. Automatic filing may therefore help many existing filers while having a smaller impact on the most vulnerable non-filers.
7. It could reduce professional review opportunities:
From a compliance perspective, accountants and tax preparers often identify:
Missed credits
Benefit eligibility
Prior-year adjustments
Pension-splitting opportunities
Disability Tax Credit eligibility
If taxpayers simply accept an automatically prepared return, some planning opportunities may never be identified.
My assessment as a tax professional
The CRA's auto-filing initiative is excellent for:
Seniors with only OAS/CPP and no deductions.
Individuals on social assistance with very simple affairs.
People who otherwise would not file at all.
But it is not a substitute for tax preparation whenever a taxpayer has deductions, credits, family changes, self-employment income, rental income, foreign income, or tax-planning opportunities.
If I had to summarize the biggest risk in one sentence:
The CRA can automate data collection, but it cannot fully automate knowledge of a taxpayer's personal circumstances.
That's the fundamental limitation of the program.
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