Tax Tip #1 – What Happens If I File My Canadian Tax Return Late?

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Your Canadian tax return is due April 30th unless you or your spouse or common-law partner carry on a business in which case you have until June 15th. Note however that any tax balance owing still needs to be paid by April 30th to avoid interest charges.

If you fail to file your Canadian Income Tax return (T1) the Canada Revenue Agency will impose a 5% penalty on any outstanding balance owing in addition to a 1% charge per month on any remaining balance.

Also note that CRA will charge interest on any outstanding tax balance at the prescribed rate for the period. Currently the prescribed rate for overdue taxes is 5%.

For CRA prescribed rates visit the following page:

http://www.cra-arc.gc.ca/tx/fq/ntrst_rts/menu-eng.html

READ  Is your corporation at risk of being deemed a personal services business (PSB) by the CRA?

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