We know, life gets hectic, and it can be easy to forget an appointment or deadline. But, it’s best not to forget to file your taxes on time. To help you remember, check out why it’s important to file your taxes on, or before the April 30 tax deadline.
Missing the Tax Deadline in Canada
If you file late and don’t owe anything to the Canada Revenue Agency:
If you file after the April 30 Tax Deadline but don’t owe any taxes, you won’t have any late filing penalty or interest to pay. But that still means that the CRA will hold your refund until you actually file.
If you owe taxes and file late:
If you owe taxes to the CRA for the 2017 tax year and don’t file your tax return by the deadline, the CRA will charge you a late-filing penalty as well as compound interest. Your charges for filing late will be calculated like this:
- 5% of the balance owing as late filing penalty
- 1% of the balance owing as additional penalty for every full month you’re late (up to a maximum of 12 months)
- Interest charged on the above penalty
- Additional compound daily interest on the balance owing based on prescribed rates by the CRA
For example, if you file 12 months late, you’ll be charged 17% on the balance owing, plus interest on penalties dating back to the original deadline.
Also, if you were charged a late filing penalty for either 2013, 2014, 2015 or 2016, the penalty may go up to 10% of your 2017 balance owing, as well as an additional 2% for every month you’re late up to 20 months maximum.
That means your late filing penalties can go up to a maximum of 50% of balance owing.
Balance Owed to the CRA
Self-employed individuals and landlords often have balance owing, since their income tax is not deducted at source like it is for salaried individuals. We’ve got some great posts on tax filing tips for freelancers as well as some of the most common deductible expenses for rental properties to help you out.
If you have a balance owing, your payment has to be received by the Canada Revenue Agency on or before the tax deadline in Canada on April 30, 2018. Make sure your envelope and cheque are post-marked accordingly!
Waiving Late Filing Penalties
There are some cases where you can have your late filing fees waived. This is usually in circumstances where your return was late for reasons beyond your control. You’ll have to complete and submit Form RC4288 (Request for Taxpayer Relief) mail it to the intake centre in your province or territory.
Don’t get stuck with late filing penalties and interest charges this year. Get your taxes done before midnight on April 30, 2018 with TurboTax, the most accurate and easy way to file your return.