50,000 public servant tax slips reissued so far due to Phoenix pay problems

Officials with the department overseeing the Phoenix payroll system say about 50,000 tax slips have had to be reissued so far, and more than 2,000 public servants have called the pay centre with tax-related questions.

Tax slips were reissued for about 28,000 people in British Columbia and 22,000 people in Quebec.

The issues will be fixed and correct slips will be available by Feb. 28, Marie Lemay, deputy minister of Public Services and Procurement Canada, said at a technical briefing Wednesday morning in Ottawa that focused on preparations for filing tax returns.

Public servants are asked to wait until Feb. 28 to print out their tax slips.

The department has been providing regular updates on the Phoenix system and its efforts to handle issues that have emerged since its rollout last year and tens of thousands of bureaucrats began reporting overpayments and underpayments.

The next briefing on March 8 will deal with the overall effort to handle pay-related issues.

$140M in overpayments in 2016

Some public servants have expressed concern that overpayments will push their taxes owing higher for 2016, while others worry lump sum payments in 2017 for work done last year will affect the following year's taxes.

Others have told CBC News their issue is that overpayments come with higher pension and union dues, making filling out the correct information on tax forms challenging.

In 2015, under the old pay system, about $78 million in overpayments were made government-wide, according to Lemay.

In 2016, that number jumped to $140 million ($22 million from the old system, and the rest from Phoenix after the system rolled out beginning in February that year).

Overpayment amendments

Lemay reiterated Wednesday that anyone with overpayments who reported them before Dec. 31 shouldn't see a problem with their tax slips.

"The vast majority of overpayments flagged before Dec. 31 will not appear on tax slips, since earnings have been corrected before the tax slips were issued," she said.

Anyone whose overpayments still show up on their tax slips are asked to file their taxes as usual. Amended tax slips will be issued with corrections.

People who get their amended slips after filing their taxes will not have to refile: the amended T4s will go to the Canada Revenue Agency and tax returns will be adjusted. Those who get the amended slips before filing their taxes are asked to use them to file their taxes.

As for repaying overpayments, Lemay said affected employees are being contacted to arrange repayment plans with options that include installments and scheduled payments.

"Our goal is to ensure that repayments do not impose any financial burden on anyone."