In this issue:

• Canada Revenue Agency – Penalties of up to $5,000 for missing foreign tax identification numbers
• Request illustrations for in-force participating life insurance contracts
• Sending out 2020 tax slips
• 4 updated forms are now available – Please use the new online versions
• COVID-19: Business Continuity Plan

CANADA REVENUE AGENCY – PENALTIES OF UP TO $5,000 FOR MISSING FOREIGN TAX IDENTIFICATION NUMBERS

The Canada Revenue Agency (CRA) has announced that it plans to impose monetary penalties of up to $5,000 for missing foreign tax identification numbers (TINs) in declarations of tax residence. 

These penalties will be levied against financial institutions and, potentially, clients who didn’t provide a TIN when purchasing insurance for specific products* on or after January 1, 2021.

As a result, we may be forced to declare your client's account to the CRA because of an incomplete declaration of tax residence. In that case, they would be subject to a penalty of up to $500.

*For universal life, participating life and permanent life insurance products that offer cash surrender values or a savings component. (Products subject to the Anti-Money Laundering Act (AMLA) and the Fight against Tax Evasion (FTA)).

What information is required in a declaration of tax residence?

The declaration must contain:

• Name of the policyowner
• Home address
• Country of tax residence
• TIN for each foreign country
• Canadian social insurance number 
• Date of birth
• Signature date
• Signature

Companies must also provide:

• Business number or trust number
• Entity classification
• Controlling person’s country of tax residence, if applicable

Information

To find out more about your obligations regarding the fight against tax evasion, visit this Webi section or contact your compliance officer.

REQUEST ILLUSTRATIONS FOR IN-FORCE PARTICIPATING LIFE INSURANCE CONTRACTS

As announced in November 2020, the dividend scale rate increased to 5.75% on January 1, 2021. We’re now ready to process illustration requests for Accelerated Growth and Estate Enhancer contracts purchased after August 2017.

SENDING OUT 2020 TAX SLIPS

It’s almost tax time. We’ll be mailing out your clients’ 2020 tax slips by February 28, 2021.

Since you’re in the best position to answer your clients’ more complex questions, if they call our Client Relations Centre with questions about their tax slips, we’ll ask them to talk to you.

Would you rather retrieve the tax slips yourself?

Tax slips for in-force contracts will be available by March 5, 2021, in Client Documents on the Webi home page toolbar. 

Tax slips for representative commissions

The tax slips for your commissions will also be mailed out by February 28, 2021.
Note: There is no electronic version of these slips. 

4 UPDATED FORMS ARE NOW AVAILABLE – PLEASE USE THE NEW ONLINE VERSIONS

We’ve revised the following 4 forms to make them easier to use and to help meet new regulatory requirements:

• Insurance Application – Life, Health and Disability – 07002E
• Request for Change of Policyowner – 09614A
• Request for Change Without Evidence – 09219E
• SOLO Essential Disability Income Application – 15021E

The new versions are now available, in PDF on Webi and in paper format at the warehouse. Please destroy any old copies you have.

Try the online versions—they'll make your life easier!

• The DSign electronic application adapts to the product selected and the answers provided. Your clients could even be approved as soon as the form is submitted! 
• PDFs are easy to read, reduce transcription errors and can be sent instantly by email to our teams, as long as you’re using a secure email address (such as those ending in @dfsin.ca).
• When you use the PDF version on Webi, you’re always sure you have the most recent version.

All the information related to COVID-19 is gathered in a dedicated section on Webi.