Learn How To Become An E-FILER

What is Efiler?

EFILE is an automated mechanism that enables qualified tax preparation service providers and discounters to send information about individual income tax returns to the Canada Revenue Agency (CRA) straight from EFILE–certified tax preparation software.

Taxpayers may take their tax slips and supporting documents to a registered tax preparer and for a fee, the tax preparer will prepare their return and send it to us electronically using EFILE.

Eligibility: Who can become an E-Filer

Any individual or organization that is in the business of providing tax preparation services can register as an E-filer with the Canada Revenue Agency by satisfying the following conditions:

Be 18 years of age or older

Be a Canadian resident

Have a valid Social Insurance Number (SIN)

Be a discharged bankrupt (if applicable)

As a matter of fact, if an individual or an organization is preparing more than 10 returns for a fee, it is mandatory for them to electronically file their returns.

This applies to filing both T1 and T2 returns. The only exception is when a certain type of return is excluded from E-filing. This will be discussed later.

To become an E-filer, the CRA has a screening criterion. Every E-filer is reviewed on an annual basis under this criterion and must meet all of the requirements in order to be registered as an E-filer with the Canada Revenue Agency

Eligibility: Screening Criteria

A screening process is undertaken to evaluate the risk of an applicant as an E-filer. An E-filer deals with highly private and confidential information of a taxpayer. Therefore, it is critical to have a screening process that will ensure that E-filers can be trusted with the confidential information of taxpayers. This helps in maintaining a high level of public confidence in the E-filing system and ensures that all participants adhere to high standards of conduct and integrity.

As per the Canada Revenue Agency, all applicants must meet the following screening criteria:

Not been convicted under the Income Tax Act, the Excise Tax Act, or an income tax act of a province or territory

Not been assessed a penalty under the Income Tax Act, the Excise Tax Act, or an income tax act of a province or territory

Not failed to file personal, corporate, GST/HST, or information returns as required, under the Income Tax Act, the Excise Tax Act, or an income tax act of a province or territory

Not failed to comply with the requirement to pay, collect, or remit taxes as required under the Income Tax Act, the Excise Tax Act, or an income tax act of a province or territory

Not failed to comply with the requirement to register under the Excise Tax Act

Not failed to comply with the requirement to keep adequate books and records under the Income Tax Act or the Excise Tax Act

No tax liability under the Income Tax Act, the Excise Tax Act, or an income tax act of a province or territory;, or the applicant has a tax liability and has reached a repayment agreement with the collections section of the tax services office, or a similar provincial authority, and has not breached the repayment agreement

Not been convicted of an offence under the Tax Rebate Discounting Act

Not made any misrepresentations on their application or renewal form or in any correspondence, conversations or updates submitted relevant to the application or renewal

Not engaged in any activities that resulted in suspension of electronic filing privileges in a previous year, or that would have led to suspension if they had been discovered during the program

Not been rejected for E-fileFILE in either of the previous two filing seasons (other than one that was conditionally rejected but later met the required conditions)

Not or does not knowingly, directly, or indirectly, employ or accept help from any person who has been, or who would have been, denied acceptance into the program, or who has been suspended from the program. This includes any individual whose actions resulted in the rejection or the suspension of a corporation or a partnership from the program

Not engaged in fraud, dishonesty, breach of trust, or other conduct of a disreputable nature

Tip: The screening process typically takes 30 days to complete. So, it is highly recommended that applications to become an E-filer must be filed in December to ensure that all formalities are complete on time.

T2 Corporation Internet Filing

Do not register for EFILE if you are only filing your own T2 Corporation income tax return. Visit the Corporation Internet Filing web page for more information.

What is the E-FILER Renewal Process

The renewal process is an annual online process that needs to be completed every year prior to tax season.

For more information please click here