The Canada Revenue Agency’s new tool to simplify travel deduction has baffled some northerners
A new online tool designed to simplify the process of claiming the travel allowance for northerners is causing more confusion than trust for some northerners.
On Monday, the Canada Revenue Agency (CRA) announced an online tool listing the lowest round-trip fares (LRA) for more than 135 airports in mandatory northern zones. LRAs are required to claim the travel deduction at tax time.
However, the CRA figures do not seem to reflect the reality of northern flights, especially when compared to the LRA tables provided by some northern airlines.
For the months of January through March 2022, the CRA tables list the LRA from Dawson City, Yukon to Vancouver as $906.94. For 2021, Air North’s own charts list a price of $1331.23.
For the months of January through March 2022, CRA lists the LRA from Yellowknife to Edmonton as $923.21, while Canadian North lists that flight as $765.73.
“In the first half of the year, the CRA count is higher than northern Canada,” says Kevin O’Reilly, the NWT MLA for Frame Lake.
O’Reilly says he’s been asking the CRA to do something like this for years because it’s a headache for Northerners.
“But CRA numbers drop dramatically in April through late 2022, and that coincides with part of the time Canadian North was the only airline flying direct between Yellowknife and Edmonton — so I don’t know how CRAs came about.” is with those numbers.”
Nathalie Prieur, representing the CRA at an online press conference on Tuesday, said the CRA arrived at its fares by working with a contracted travel service provider to determine the lowest economy fares available.
“We recognize that airfares fluctuate regularly and the lowest fare option available can sometimes be less or more expensive than the amounts shown in the table,” she said.
“Northern residents can continue to self-determine the LRA if they prefer [long as] they can provide the receipts or documents.”
Virginia Labelle is a retired Certified Public Accountant based in Whitehorse. She says the CRA had a great idea to put the entries online, but a link is missing.
In the past, when she did taxes for Yukoners, she said she relied on the LRAs that Air North publishes.
“It’s a bit more organized and official and changes seasonally,” says Labelle. “Except what they’re looking at is the lowest level of economy fares typically available.”
She says CRAs’ guidelines state the lowest airfare usually available on the day you travel, which means the amount you would pay if you booked and flew on the same day.
In most cases, this amount is higher than the figures shown in the CRA tables.
The CRA says the online tool is a pilot project and that feedback will be considered if adjustments need to be made. The CRA did not provide information on how residents can provide feedback.