April 30, 2019

Late tax filing penalties could add up

Midnight tonight (April 30) is the deadline for Canadians to file their 2018 income tax returns. Everyone’s returns should be submitted to the Canada Revenue Agency (CRA) by this date, but it’s primarily anyone who owes money that should be concerned. Starting May 1, Canadians who owe money on their tax return will begin to face late fee penalties. Those who will receive a refund don’t face the same problem. However, if there are any omissions or false statements on your tax return, you could still face a penalty of $100 or 50 percent of the falsified amount. If you find yourself in this situation, you should contact your tax professional for advice as there are programs like the Voluntary Disclosures Program, which may be able to help you.

Key Takeaways:

  • Canadians who owe the CRA will face penalties starting May 1.
  • Late penalties on the amount owed start at 5 percent interest compounded daily. For each full month the return is late, one percent is added, up to a maximum of 12 months.
  • After a year of non-payment, the CRA charges 10 percent interest on the balance owing plus two per cent for each full month, up to 20 months. The rate is subject to change every three months.

“If you owe, the meter begins running May 1.”

Read more: https://www.bnnbloomberg.ca/personal-investor-late-tax-filing-penalties-could-add-up-1.1250778

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