Just in time for RRSP season, changes to a popular piece of Canadian tax software means some customers might not like where or how their private data is being used.The Canadian website SimpleTax changed its terms of service in 2020, removing a promise to ‘never, ever’ sell personal data. (Anis Heydari/CBC, The Canadian Press)Listen8:33As the deadline to make contributions to retirement plans such as RRSPs looms for Canadians, a change to a popular piece of Canadian tax software means some of its customers might not like where or how their private data is being used. SimpleTax, founded in Vancouver, has been certified by the Canada Revenue Agency to electronically file tax returns since the 2012 tax season. The company operates on a “pay what you want” basis, sometimes called donationware. Essentially, you can pay whatever you like to use SimpleTax, whether that is $5, $50 or nothing at all.Click here to download CBC Radio’s business and economics show Cost of Living to your podcast player of choice, or find us on the new CBC Listen app. It’s currently one of several online or software applications the federal agency’s website refers Canadians to if they are looking for a digital way to complete their taxes. For years, the SimpleTax terms and conditions used plain language to explain that your personal information, such as the financial and demographic information you enter into your tax return, is not for sale. Jeff Sagal has been a SimpleTax fan and user for years, but isn’t sure he’ll keep using it after promises to refrain from selling data were removed from its privacy policy. (Charlie Gunn/Submitted by Jeff Sagal) Vancouver programmer Jeff Sagal found that promise appealing. He was one of multiple SimpleTax clients who spoke to CBC Radio’s The Cost of Living about the software. The easy-to-understand privacy policy was a key selling point. “I did look at their privacy policy the first time that I used it and I was pretty impressed by the fact that they not only mentioned encryption in it … [they] were incredibly transparent about the fact that they had no access to your information whatsoever,” said Sagal. Part of the SimpleTax privacy policy as of Sept. 6, 2018, is shown in a screenshot from the Internet Archive. (archive.org/SimpleTax) In late 2019, the tax software startup was acquired by another Canadian company in the world of fintech — or financial technology — WealthSimple. The company offers savings and investment products, including registered retirement savings plans or tax-free savings accounts. Owners change, as do the promises they make Following the WealthSimple acquisition, SimpleTax’s terms of service changed. “We will never, ever sell” your data was no longer a promise. This language replaced ‘We will never, ever sell your data’ in the SimpleTax terms of service in early 2020. (Screenshot/SimpleTax) WealthSimple declined an interview request from CBC Radio, but in an emailed statement said giving users control over their personal information is a priority for the company. “The recent changes made to our Privacy Policy are the first step in providing users with a better SimpleTax service for the 2019 tax year,” wrote Peter La. The company sent an email alerting all clients to the change in its privacy policy in early January. The SimpleTax website, under ‘Options,’ allows users to opt-out of their data being accessed if they know to navigate to this area. (Screenshot/SimpleTax) As of February 2020, user profiles on SimpleTax appear to allow the company to access tax return data even when a user is not actively completing a tax return, however, the option to opt-out is available if desired. Why the change? According to WealthSimple’s emailed statement, the company wants to “implement further measures within the [SimpleTax] product to obtain user consent for advanced product features.” Given that the company offers investments directly related to tax returns, such as RRSPs and TFSAs, a customer database that includes demographic information on Canadians and their plan contribution limits could provide sales and marketing leads. This 2015 photo shows the SimpleTax founding team, based in Vancouver, B.C. (Courtesy SimpleTax) WealthSimple did not provide information on how large the SimpleTax customer base is when asked by CBC Radio. According to Dana DiTomaso, president of digital marketing agency Kick Point, the language change may have been necessary regardless of WealthSimple’s plans for SimpleTax. “[The older language was] a really vague terrible way of phrasing things in a privacy policy, because [it said] we will never ever sell your data, but they sold the company which technically contains the data,” said DiTomaso. Selling the company is selling the data While SimpleTax and WealthSimple have continued to maintain on social media that client data is not for sale, posting statements like “neither Wealthsimple or SimpleTax have ever, or will ever sell your data” after that same line was fully removed from the privacy policy and terms of service. However, as DiTomaso pointed out because the company SimpleTax itself was sold, the personal data of its clients was technically sold along with it. You can get in trouble with these kinds of privacy policies- Dana DiTomaso, digital marketing expert DiTomaso, who is also a technology columnist for CBC Radio, described the old privacy policy as “friendly and personal” but not necessarily sound business practice. “You can get in trouble with these kinds of privacy policies, so the fact that they updated it after the acquisition totally makes sense,” said DiTomaso. Has the marketing started? The SimpleTax website is already showing ads suggesting Canadians “put your tax refund to work with WealthSimple.” The RRSP tax refund calculator made available while completing a 2020 tax return on SimpleTax now directs end users to invest their potential refund with WealthSimple. (Screenshot/SimpleTax) Tax returns contain information that includes RRSP contributions, pension plan contributions, income over multiple years, overseas investments, home ownership, marital status, how many children you have or whether anyone in a family is disabled. An ad for WealthSimple appears at the bottom of the SimpleTax website in February 2020. (Screenshot/SimpleTax) This could provide a huge trove of data for an investment company such as WealthSimple to create targeted advertisements. Attention @simpletax usersYou have been opted **IN** to give access to your very private tax returns for data mining, regardless of you’ve donated before or not!I’m waiting for an answer to this: https://t.co/6CY5GLJMry https://t.co/E0tvtZtiba—@deddebme SimpleTax customers expressed concern on social media including multiple threads on Reddit. “I can’t think of any reason why you would remove that line unless somewhere down the line in the future you were looking to make some profit off of the data,” said Jeff Sagal, who has not yet decided if he’ll continue using SimpleTax for the 2020 tax year. Written and produced by Anis Heydari. Reach him at anis@cbc.ca or tweet @BetamaxRob. 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The Canadian tech company that changed its mind about using your tax return to sell stuff | CBC Radio
