Personal Tax Tip – Filing Taxes Late? Potential Penalties
Filing Taxes Late – Potential Penalties
The deadlines for filing your 2015 tax return are: May 2nd, 2016 (because April 30th fell on a Saturday this year) if you have no business income, and June 15th if you are self-employed. If you have already missed the May 2nd deadline, what penalties will you be facing if you didn’t file on time?
The CRA will charge 5% of your 2015 taxes owing, plus 1% of the taxes owing for each full month the return is late, up to 12 months maximum. So if you file your taxes in July, you will end up owing the CRA an additional 7% of your taxes owing—5% base, plus 1% for May and June. If this is not the first time taxes have been filed late, then the CRA could increase that penalty to 10% of the balance owing, plus 2% per full month, up to twenty months!
If you’re self-employed, you don’t have to file taxes until June 15th—but if you end up owing taxes to the CRA when you do file, then they will start charging you interest on that balance from May 2nd, not June 15th.
It is important to get your taxes completed on time or as soon as possible. Contact us today and let us help you, and visit our Personal Tax Resources page for useful tax filing information.