Ignore CRA’s lowest return airfares, YK specialist says

Tax consultant Andy Wong, long a form of NWT lowest return airfare oracle, says the CRA’s latest efforts to simplify the issue are praiseworthy – but can be ignored, for now.

Wong says the CRA’s tables of lowest return airfares, designed to help people claim the Northern Residents Tax Deduction, contain numbers that “do not seem to reflect anything close to reality.”

For example, the CRA’s tables list the lowest return airfare between Yellowknife and Edmonton from April to September 2022 as $493.76.

For the same period, airline Canadian North – publishing a table of its own – said the lowest return airfare was around $1,000.

“There is such a discrepancy,” Wong said by phone on Wednesday.

“You can pretty-much ignore the CRA’s numbers. Just go to Canadian North.”

While Canadian North’s list of lowest return airfares contains a disclaimer asking that people do not share or publish the data, a Google search for “Canadian North lowest return airfare” will get you the table in question.

Earlier this week, Peter Fragiskatos – parliamentary secretary to the minister of national revenue – acknowledged criticism that the CRA’s figures don’t align with some residents’ experience of flight costs last year.

“It could be that people disagree with the figures in that table, and that’s why they can submit documents in the way that they always have in order to secure a more favourable deduction,” Fragiskatos said, adding that the CRA’s quoted figures represented “a seasonal average.”

Fragiskatos said the publication of the CRA’s tables was a pilot project and would be subject to alteration once a consultation period begins next month.

Wong, who has for years helped NWT residents to understand the return airfare they can claim through the tax deduction, examined CRA and Canadian North data for four of the territory’s communities as a test.

He said calling the CRA tables a pilot project was “a poor excuse” for numbers that “cannot be correct,” but added that the CRA had to be given credit for taking a “quantum leap” in recognizing the issue and attempting to provide tables in the first place.

“It’s not a great product right now but it’s promising, and we have to acknowledge that,” Wong said.

“You can ignore the CRA numbers for now. It’s going to take a bit of work. I’m sure the CRA is going to get it, but not for 2022.”