Filing your tax return late should be avoided if possible, because doing so can end up costing you big – especially if it happens year over year! A late tax return can come with interest, penalties and even interest on your penalties! However, if you have missed the April 30 deadline, don’t dismay – Liu & Associates can help! Read on for what you need to know about late tax returns.
What Fees Are Associated with Filing My Taxes Late?
If you owe taxes to the CRA and you fail to meet the April 30 deadline, penalty charges and compound interest will accrue on any unpaid amount. The late-filing penalty is 5% of your 2016 balance owing, plus 1% of your balance owing for each full month your return is late (maximum of 12 months).
If you have already racked up a late-filing penalty in previous years, your new penalty may bump up to 10% of your balance owing, plus 2% of your balance owing for each full month your return is late (to a maximum of 20 months).
Starting May 1, the CRA starts to charge compound daily interest on any unpaid amounts owing for the previous year. Even more, you will start getting charged interest on any penalties you receive starting the day after your return is due.
What If I Don’t Owe Any Tax?
If you don’t owe the government any money, you don’t need to worry about getting hit with a penalty – but the government will hang on to any refund until you file a return.
You’re Not Alone
Liu & Associates can help minimize the stress that is associated with filing a late tax return. Our team will help to create a solution to your late filing. Give us a call to book an appointment today!