What are the consequences of not filing taxes on time?
There are consequences for not filing taxes on time in Canada. Here are some of the potential consequences:
Late-filing penalty: If you owe taxes and file your return after the deadline, the CRA will charge you a late-filing penalty. The penalty is 5% of your balance owing, plus an additional 1% of your balance owing for each full month your return is late, up to a maximum of 12 months.
Interest charges: If you owe taxes and don't pay them on time, the CRA will charge you compound daily interest on the balance owing, starting on the day after the due date.
Loss of benefits: If you receive certain benefits, such as the Canada Child Benefit or the GST/HST credit, and you don't file your taxes on time, your benefits may be delayed or stopped.
Legal action: If you continue to not file your taxes, the CRA may take legal action against you, such as garnishing your wages or seizing your assets.
Difficulty obtaining credit: Not filing your taxes on time could affect your credit score and make it more difficult to obtain credit or loans in the future.
It's important to file your taxes on time to avoid these consequences. If you're unable to file on time, it's best to contact the CRA to discuss your options and avoid any penalties or interest charges.