Foreign Bank Account Interest is NOT shown in Canada. But interest is very minor and does not affect overall taxes.

Question

105 views1 day ago

0

Poonam (anonymous) Posted 1 day ago MadanCA Team edited answer 1 day ago

Foreign Bank Account well below the $100,000/- threshold for T1135 reporting.

But Foreign Bank Account Interest not shown in CRA returns for past 10 years.

Even if that foreign bank account interest Income is shown I am still below Basic Personal Exemption Amount in Canada. So no income tax is due.

Do I have to ReFILE my taxes or Change My Return or do T1-Adj for all the previous 10 years?

Do I have to do a VDP for all the previous years? It will be very complicated and expensive to do so!

Should I just IGNORE it or inform CRA about the amount for each year and let them do the adjustment and reassessment on their own.

Thanks for any help.

score 0 · Answer 1 · 2025-04-14T17:51:52+00:00

Hi Poonam,

Thanks for your question. Here’s a summary of your situation and recommended next steps:

Key Facts:

Do You Need to Refile or Use the VDP?

Technically yes—all worldwide income must be reported, even if no tax is owed. That said:

Voluntary Disclosures Program (VDP) offers full protection but is time-consuming and may not be necessary for small, non-taxable amounts.
T1-ADJ (adjustment requests) for all 10 years is a formal correction route but can be complex and costly.
Sending a voluntary letter to CRA disclosing the interest amounts may be a low-effort, reasonable middle ground.
Doing nothing carries some risk if CRA audits or asks questions later.

Recommendation:

Prepare a letter to CRA listing:

The annual amounts of unreported interest
Confirmation that no tax was owing
A good-faith explanation and request for guidance on whether formal adjustments are needed

This approach balances compliance with practicality.

Mississauga's Thought Leader