CRA Late Filing Penalty - What You Need to Know
In 2016, there were over 10 million tax returns filed in Ontario. Are you one of the individuals that filed late or forgot? It's a common issue, but unfortunately can have negative consequences on your behalf.
Depending on your situation, different penalties can be applied and you may be subjected to a CRA reassessment. Below you will learn about CRA late filing penalties, deadlines, and how to receive tax relief.
CRA penalties for filing taxes late
Filing taxes late for 2017 will result in requiring to pay 5% of the balance owed and an extra 1% for every month that your return is late for up to 12 months.
A late filing penalty for 2014, 2015, and 2016 tax returns may be 10% of your total 2017 balance owed and 2% of this amount for every month that the return is late for up to 20 months.
If an individual does not file a tax return for an income of $500 or more during any given tax year, this is considered failure to report income. Federal and provincial penalties are the lesser of:
10% of how much you didn't report on your tax return.
50% of the difference between the understated tax, the amount you failed to report and the withheld tax you failed to report.
Some individuals purposely file incorrect information on their tax return to pay less or to bump them into other tax brackets. This is punishable by the CRA as it is considered false statements. The penalty for this is:
50% of the understated tax amount